Consumer complaint received 2017-09-09
Company: ACS Education Services
State: TX
Product: Student loan
Sub-product: Federal student loan servicing
Issue: Dealing with your lender or servicer
Sub-issue: Don't agree with the fees charged

Complaint:
XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX, TX XXXX Consumer Financial Protection Bureau XXXX XXXX XXXX XXXX, IA XXXX  XX/XX/XXXXDear Sirs/Madames : I am filing this Complaint to report suspected fraud on the part of ACS Education Services ( ACS ) and XXXX XXXX XXXX XXXX XXXX ( XXXX ). I am told that XXXX was formerly known as ACS. I do not believe that I ever signed a contract with ACS or XXXX and neither entity has provided a copy of the alleged contract, despite repeated requests for the same. I have disputed the loan with all three major credit bureaus. I reached out to the Ombudsman Group and received no assistance whatsoever from this group. I am at a loss about what to do and ACS/XXXX is essentially extorting {$860.00} a month from me, causing extreme financial hardship for me and my family. I am hoping that the Consumer Financial Protection Bureau can assist me. I would like to initiate a lawsuit against ACS and XXXX, but I am not able to afford a constitutional lawyer to do.
Timeline of Important Events XX/XX/XXXXXX/XX/XXXX I attended XXXX XXXX at XXXX University XXXX XXXX XXXX and took out a student loan to pay tuition. I no longer have any of the original paperwork, but the loan amount was approximately {$110000.00}.
XX/XX/XXXXBegan making regular and timely payments on my student loan and continued doing so until I filed for Chapter XXXX Bankruptcy inXX/XX/XXXX.
XX/XX/XXXX I fled from my extremely violent husband ( now ex-husband ) with the assistance of the Pennsylvania Coalition Against Domestic Violence. I lived in hiding and underground until XX/XX/XXXX. I have been repeatedly stalked and terrorized by my ex-husband and I continue to be part of an Address Confidentiality Program ( ACP ). A copy of my ACP card is  attached.
XX/XX/XXXX Because I was forced to move across the country to try and hide from my ex-husband and because I left ALL of my possessions behind when I fled from my ex-husband in XX/XX/XXXX, I could no longer afford to meet my financial obligations. The law firm I worked for before fleeing would not hire me back because they had a genuine concern for the safety of other employees. I consulted with an attorney who recommended I file a Chapter XXXX bankruptcy. I filed for bankruptcy in XX/XX/XXXX. At no time did any student loan agency inform me or my attorney that daily interest on the remaining balance of the student loan would be accruing during the bankruptcy at a rate of 5 %. At the time I filed for bankruptcy, the balance on my student loan was approximately {$78000.00}.
XX/XX/XXXX I completed my Chapter XXXX bankruptcy plan.
XX/XX/XXXXI received a payment booklet from ACS. I didnt recall my student loan lender being ACS, but I called ACS to determine the account balance. ACS told me the balance was {$150000.00}. I told the representative that this was insane. The alleged balance exceeded the original loan by {$30000.00} and was twice as much as the balance due at the time I filed bankruptcy. The representative confirmed that I had never missed a payment, even during the bankruptcy plan. I called XXXX XXXX XXXX and spoke with XXXX who told me that the National Database listed my student loan balance at {$78000.00} ( which coincided with the amount I owed at the time of filing bankruptcy in XX/XX/XXXX ). I called ACS back and advised them of the information I secured from XXXX XXXX XXXX. The ACS representative told me that the discrepancy was a result of daily interest charged at a rate of 5 % during my 5-year bankruptcy plan. I told the representative that there is no way that I would ever have signed a promissory note that contained a provision that would require me to pay 5 % daily interest under any circumstance. I told the ACS representative that I dont believe ACS was even my lender and I asked ACS to provide a copy of the alleged promissory note and an accounting of the alleged current balance. I explained that I had to flee my ex-husband and left all my financial documents and paperwork behind.
XX/XX/XXXX I sent a letter to ACS confirming my conversation with ACS and XXXX XXXX XXXX on XX/XX/XXXX I asked ACS to forward a copy of the purported signed contract and an accounting of the alleged balance. I never received a response to this letter. A copy of theXX/XX/XXXX letter is attached.
XX/XX/XXXX A second letter was sent to ACS requesting a copy of the purported signed contract and an accounting of the alleged balance. I never received a response to this letter. A copy of the XX/XX/XXXX letter is attached.
XX/XX/XXXX A third letter was sent to ACS requesting a copy of the purported signed contract and an accounting of the alleged balance. I never received a response to this letter. A copy of the XX/XX/XXXX letter is attached.
XX/XX/XXXX A fourth letter was sent to ACS requesting a copy of the purported signed contract and an accounting of the alleged balance. I never received a response to this letter. A copy of theXX/XX/XXXX letter is attached.
XX/XX/XXXX After disputing the ACS debt with the three major credit bureaus, ACS sent me an inquiry asking for more information regarding my dispute. I completed the form and returned it to ACS asking them to respond to my prior letters. I never received a response to my dispute. A copy of the dispute form mailed on XX/XX/XXXXis attached.
XX/XX/XXXX Since ACS completely ignored my requests for documentation to support the alleged debt, I contacted the XXXX XXXX XXXX XXXX XXXX  for assistance. The XXXX XXXX XXXX acknowledged receipt of my request for assistance. A copy of the XXXX XXXX XXXX acknowledgement is attached.
XX/XX/XXXX I received a call from XXXX XXXX of the XXXX XXXX XXXX and discussed my case at length. She agreed that something did not appear right and stated she would investigate. I sent XXXX XXXX an e-mail with copies of the letters I had sent to ACS. A copy of the XX/XX/XXXX e-mail to XXXX XXXX is attached.
XX/XX/XXXX After making me believe for 7 months that the XXXX XXXX XXXX was actually going to help me, I received a letter from XXXX XXXX via e-mail stating that the lender ( referred to as XXXX, ACS and XXXX, leading me to believe that they dont even know who the actual alleged lender is ) had the right to charge 5 % daily interest during the bankruptcy. Of note, this letter indicates that the XX/XX/XXXX principal balance of the loan was {$110000.00}. Since I was making regular monthly payments from XX/XX/XXXX through the filing of bankruptcy in XX/XX/XXXX, this supports that the balance at the time of filing bankruptcy was {$78000.00}. I responded to XXXX XXXX telling her that this amounts to usury. There is no way that I can owe more than twice the original balance. A copy of e-mail exchange dated XX/XX/XXXX is attached.
XX/XX/XXXX I sent an e-mail to XXXX XXXX of the XXXX XXXX XXXX stating that the alleged link in her XX/XX/XXXX e-mail for supporting documentation did not work. I asked her to mail me the paperwork. XXXX XXXX ignored my request. A copy of theXX/XX/XXXX e-mail is attached.
XX/XX/XXXX I sent a second e-mail to XXXX XXXX of the XXXX XXXX XXXX asking her to mail me the paperwork. XXXX XXXX again ignored my request. A copy of the XX/XX/XXXX e-mail is attached.
XX/XX/XXXX I sent a third e-mail to XXXX XXXX of the XXXX XXXX XXXX asking her to mail me the paperwork. A copy of theXX/XX/XXXX e-mail is attached.
XX/XX/XXXX I received a letter from XXXX XXXX of the XXXX XXXX XXXX  attaching a single page document purporting to be the promissory note and a payment history from XX/XX/XXXXtoXX/XX/XXXX. I dispute that this is a true and accurate copy of any alleged promissory note since I do not recall taking out a loan in XX/XX/XXXX. I took out my loan during XXXX XXXX XX/XX/XXXX to XX/XX/XXXX ) and began making payments in XX/XX/XXXX. Of note, there is no provision in the purported promissory note authorizing usurious daily interest of 5 % under any circumstance, yet alone during the pendency of a bankruptcy. The purpose of a bankruptcy action is to provide relief to a debtor, not doubling the debtors debt by charging illegal, unconstitutional, unconscionable and usurious interest not authorized in any provision of any alleged contract. I called XXXX XXXX and left her a voice mail asking her to contact me immediately. I also asked for all payment records from XX/XX/XXXXto present and a complete copy of the original loan paperwork. A copy of the XX/XX/XXXX letter from XXXX XXXX and the paperwork included with the letter is attached.
XX/XX/XXXX I called XXXX XXXX and left another voice mail message asking for a complete copy of the original loan paperwork and all payment records from XX/XX/XXXX to present. I received an e-mail from XXXX XXXX of the XXXX XXXX XXXX stating that my request to reopen is denied. A copy of the XX/XX/XXXX e-mail is attached.
XX/XX/XXXX I replied to the e-mail from XXXX XXXX of the XXXX XXXX XXXX stating that I did not ask the XXXX XXXX XXXX to reopen my case. I told her that I have repeated requests for a complete copy of the original loan paperwork and payment records from XX/XX/XXXX to present. I told her that neither the XXXX XXXX XXXX nor ACS have provided copies of the original loan paperwork nor the payment records from XX/XX/XXXXto present. I told her that I dont think I ever took out a loan with ACS and I think that ACS is taking advantage of victims of XXXX XXXX. I demanded that she provide the documents I requested within 10 days. XXXX XXXX never responded. A copy of theXX/XX/XXXX e-mail is attached.
XX/XX/XXXX I received a letter from XXXX XXXX of the XXXX XXXX XXXX attaching a duplicate copy of XXXX XXXX XX/XX/XXXX letter and the enclosures to that letter. Copies of the original loan paperwork and payment records from XX/XX/XXXXto present still have not been provided.
Violation of Fundamental Goals of Bankruptcy Article I, Section 8, of the United States Constitution authorizes Congress to enact " uniform Laws on the subject of Bankruptcies. '' Under this grant of authority, Congress enacted the " Bankruptcy Code '' in XX/XX/XXXX. The Bankruptcy Code, which is codified as title 11 of the United States Code, has been amended several times since its enactment. It is the uniform federal law that governs all bankruptcy cases.
A fundamental goal of the federal bankruptcy laws enacted by Congress is to give debtors a financial " fresh start '' from burdensome debts. The Supreme Court made this point about the purpose of the bankruptcy law in a XX/XX/XXXX decision : [ I ] t gives to the honest but unfortunate debtora new opportunity in life and a clear field for future effort, unhampered by the pressure and discouragement of preexisting debt.
Local Loan Co. v. Hunt, 292 U.S. 234, 244 ( 1934 ). This goal is accomplished through the bankruptcy discharge, which releases debtors from personal liability from specific debts and prohibits creditors from ever taking any action against the debtor to collect those debts. Chapter XXXX, entitled Adjustment of Debts of an Individual With Regular Income, is designed for an individual debtor who has a regular source of income. Chapter XXXX allows the debtor to propose a " plan '' to repay creditors over time usually three to five years. The debtor is protected from lawsuits, garnishments, and other creditor actions while the plan is in effect.
Here, the balance of the student loan that I had, which again is not ACS/XXXX, was {$78000.00} at the time I filed for bankruptcy. The bankruptcy court made payments monthly on my student loan. When I completed my 5-year payment plan, ACS/XXXX notified me that my balance was {$150000.00}, almost double what the balance was when I entered bankruptcy five years before and far in excess of the original loan balance. There is no way that I would ever have signed a contract that would permit a lender to charge me 5 % DAILY interest on a loan. That is insane. Charging me 5 % daily interest during the course of the bankruptcy, almost doubling my alleged student loan debt, is certainly contrary to the principles and goals of bankruptcy. At no time was I ever advised that 5 % daily interest would be charged during the pendency of the bankruptcy. Despite repeated requests, ACS/XXXX  has not produced any contract that I signed that contains a provision that it is permitted to charge 5 % daily interest during the pendency of the Chapter XXXX bankruptcy. ACS/XXXX should be charged with violating bankruptcy law and my alleged student loan debt should be discharged effective immediately.
Usurious Interest Usury laws are enacted to protect people from debts bearing burdensome interest rates and to protect citizens from oppression generally. I reside in Texas and Conduents registered address is in Texas. Accordingly, Texas usury laws will apply.
FINANCE CODE TITLE 4. REGULATION OF INTEREST, LOANS, AND FINANCED TRANSACTIONS SUBTITLE A. INTEREST CHAPTER 302. INTEREST RATES SUBCHAPTER A. USURIOUS INTEREST Sec. 302.001. CONTRACTING FOR, CHARGING, OR RECEIVING INTEREST OR TIME PRICE DIFFERENTIAL ; USURIOUS INTEREST.
( a ) A creditor may contract for, charge, and receive from an obligor interest or time price differential.
( b ) The maximum rate or amount of interest is 10 percent a year except as otherwise provided by law. A greater rate of interest than 10 percent a year is usurious unless otherwise provided by law. All contracts for usurious interest are contrary to public policy and subject to the appropriate penalty prescribed by Chapter 305.
( c ) To determine the interest rate of a loan under this subtitle, all interest at any time contracted for shall be aggregated and amortized using the actuarial method during the stated term of the loan.
( d ) In addition to interest authorized by Subsection ( b ), a loan providing for a rate of interest that is 10 percent a year or less may provide for a delinquency charge on the amount of any payment in default for a period of not less than 10 days in an amount not to exceed the greater of five percent of the amount of the payment or {$7.00}. The charging of the delinquency charge does not make the loan subject to Chapter 342 or any other provision of Subtitle B.
According to Section 302.001 cited above, the maximum amount a creditor can charge for interest in Texas is 10 % per year. 10 % interest per year equates to .0273 % daily interest. The 5 % daily interest illegally charged by ACS/XXXX is clearly in excess of the amount permissible. It is actually more than 183 % higher than the amount permitted by law.
FINANCE CODE TITLE 4. REGULATION OF INTEREST, LOANS, AND FINANCED TRANSACTIONS SUBTITLE A. INTEREST CHAPTER 305. PENALTIES AND REMEDIES SUBCHAPTER A. CIVIL LIABILITY ; CRIMINAL PENALTY Sec. 305.001. LIABILITY FOR USURIOUS INTEREST.
( a ) A creditor who contracts for, charges, or receives interest that is greater than the amount authorized by this subtitle in connection with a transaction for personal, family, or household use is liable to the obligor for an amount that is equal to the greater of : ( 1 ) three times the amount computed by subtracting the amount of interest allowed by law from the total amount of interest contracted for, charged, or received ; or ( 2 ) {$2000.00} or 20 percent of the amount of the principal, whichever is less.
( a-1 ) A creditor who contracts for or receives interest that is greater than the amount authorized by this subtitle in connection with a commercial transaction is liable to the obligor for an amount that is equal to three times the amount computed by subtracting the amount of interest allowed by law from the total amount of interest contracted for or received.
( b ) This section applies only to a contract or transaction subject to this subtitle.
( c ) A creditor who charges or receives interest in excess of the amount contracted for, but not in excess of the maximum amount authorized by law, is not subject to penalties for usurious interest but may be liable for other remedies and relief as provided by law.
305.002. ADDITIONAL LIABILITY FOR MORE THAN TWICE AUTHORIZED RATE OF INTEREST.
( a ) In addition to the amount determined under Section 305.001, a creditor who charges and receives interest that is greater than twice the amount authorized by this subtitle is liable to the obligor for : ( 1 ) the principal amount on which the interest is charged and received ; and ( 2 ) the interest and all other amounts charged and received.
( b ) This section applies only to a contract or transaction for personal, family, or household use subject to this subtitle.
Since the total of the student loan debt at the time of bankruptcy was {$78000.00} and the balance at the end of the 5-year bankruptcy plan was {$150000.00}, it appears that the interest charged was at least the difference of {$73000.00}. According to Section 305.001 ( a ) ( 1 ) cited above, I am entitled to three times the interest, which is {$210000.00}. Since ACS/XXXX charged more than twice the amount authorized ( actual amount charged is more than 183 times the amount authorized ), I am also entitled to receive the principal amount and interest amount. Pursuant to Section 305.002 cited above, it appears I am also entitled to receive {$78000.00} ( principal amount ) and {$73000.00} ( interest amount ), which is {$150000.00}. Accordingly, the total amount ACS/XXXX owes to me is {$370000.00}. I would also be entitled to attorneys fees and costs if I am forced to retain counsel.
Remedy Sought I have been forced to make monthly payments of {$860.00} for a debt I do not owe, which is causing extreme financial hardship. If I fail to make payments, ACS/XXXX will destroy the credit I have worked so hard to repair since having to flee a violent ex-husband and being forced into bankruptcy. Although I am entitled to receive {$370000.00} from ACS/XXXX, which is far in excess of the loan balance, I will be willing to accept satisfaction by ACS/XXXX of the alleged loan with written notification to all three major credit bureaus stating the loan was paid in full and was in good standing. I am willing to forego recovery of penalties if ACS/XXXX will simply mark the loan as paid in full. If I am forced to file a lawsuit to remedy this situation, I will seek all penalties available and will make a claim for compensatory damages, punitive damages, exemplary damages and attorneys fees and costs.
Please feel free to call me at ( XXXX ) XXXX if you have any questions or comments. Thank you.
Sincerely, XXXX XXXX XXXX XXXX

Company response to consumer: Closed with explanation