Fox News reported Tuesday that Sallie Mae, which is in charge of giving out loans to college students, has reached a $60 million settlement with the federal government. The student loan giant was allegedly charging military members excessive interest rates on their student loans.
Sallie Mae will also have to refund troops $30 million in late fees assessed on loans and pay a $6.6 million civil penalty. This brings the total to nearly $97 million.
By law, Sallie Mae is allowed to impose interest rates up to 6 percent onto military members; however, it was charging military troops more than that. Some were hit with $500 in excess interest.
Attorney General Eric H. Holder Jr. said in a news conference, "We are sending a clear message to all lenders and servicers who would deprive our service members of the basic benefits and protections to which they are entitled: This type of conduct is more than just inappropriate, it is inexcusable. And it will not be tolerated."
The settlement has been filed, but now a judge needs to approve it.
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