Consumer complaint received 2025-02-16 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Received bad information about your loan
Company: EdFinancial Services
State: NJ

Complaint narrative:
Sent XX/XX/XXXX : I am formally disputing the validity and enforceability of my student loan obligation due to a breach of my personal and financial information, which was compromised without my authorization. Under the Privacy Act of 1974 ( 5 U.S.C. 552a ) and the Family Educational Rights and Privacy Act ( FERPA ), my personal data should have been safeguarded against unauthorized access and disclosure. The Higher Education Act ( HEA ) also establishes standards for the handling of student loan information. The recent actions have resulted in a violation of these federal protections, rendering my agreement with EdFinancial legally unsound. Given this breach, I assert that my loan contract is no longer binding, as it was compromised under circumstances that violate federal law. 

Given the severity, I request an immediate cancellation and discharge of my student loans and a formal investigation into this breach of my protected information. 

Email : customerservice@edfinancial.studentaid.gov replied XX/XX/XXXX " Thank you for your inquiry regarding the unauthorized release of information and its implications for your federal student loans. 

Edfinancial Services, as a contractor to the U.S. Department of Education ( ED ), is committed to adhering to all applicable laws and regulations concerning the management of customer data. Edfinancial Services has not engaged in any activities that would expose data through unauthorized or unlawful means. We are contractually obligated to comply with federal government and ED record retentions laws and standards, including the Privacy Act of 1974. Edfinancial Services, as a contracted entity, is not permitted to copy, delete, archive, or transfer borrower data without the prior written consent from ED. Such consent is granted only when lawful and necessary. 

Regarding loan discharge and forgiveness, Edfinancial Services is authorized to discharge or forgive loans only under programs established by statute and the regulations thereof, and only when a borrower meets all program requirements as validated by ED. To learn more about current student loan discharge and forgiveness programs, please visit StudentAid.gov/manage-loans/forgiveness-cancellation. 

Please note that the Privacy Act of 1974 governs the collection, maintenance, and dissemination of personal information by federal agencies. Furthermore, the Family Educational Rights and Privacy Act ( FERPA ) is designed to protect the privacy of student education records and grants students certain rights regarding their records. 

While both mandate adherence to fair information practices and restricts disclosure without consent, neither provides mechanisms for discharging student loans due to privacy violations. 



If you have specific questions or concerns about your account data, StudentAid.gov provides general information, including details about aid, enrollment history, and other assistance. If you have detailed questions about your account, please contact us at XXXX. 
Thank you, XXXX Edfinancial Services ''

Company response to consumer: Closed with explanation