Nelnet, JP Morgan and Citi sued for conspiring to defraud tax payers (JPM, C, NNI)
Since I sued Nelnet in 2003 (settled) and many of my readers and clients have serious problems with student loans, I had a look at Carl Herman’s article:
Whistle-blower sues banksters: Fraud on student loans. Vampire banks feed on near-children
Banksters took a hit through disclosure of court documents of a former Nelnet employee’s lawsuit for $280 million for fraud to college students through student loan disinformation. JP Morgan, Citigroup and Nelnet are the defendants in the lawsuit. ...
Carl links to Did JPMorgan And Citi Screw Taxpayers By Cheating On Student Loans? (JPM, C, NNI)
Previously sealed court documents show that JPMorgan (JPM) and Citigroup
(C) are being sued for conspiring with education finance company Nelnet (NNI) to allegedly receive federal student loan subsidies by making false claims and illegally recruiting more borrowers.The civil action suit was filed in May 2008 at U.S. District court in Omaha, Nebraska and was posted recently on Wikileaks, just before it was officially unsealed by the court.
The 285 page suit (below) says Nelnet illegally induced students to apply for federal student loans, paying telemarketers to aggressively push the government product, and used false advertising to get more applications, like promising that students would save thousands of dollars in interest payments by consilidating their loans with Nelnet. They then presented false claims to the Department of Education to receive federal funding.
According to the suit, JPMorgan and Citi alledgely “ratified and/or authorized the wrongful acts of Nelnet and have benefitted from such conduct.”
Without specifying a total amount, the suit asks for triple the U.S. claim payments and other damages, plus civil penalties. It asks for $5,500 to $11,000 for each claim Nelnet presented to the Department of Education between 2004 and 2007 (the number is unclear).
The government could have intervened in the suit, but declined, according to court filings.
Like the sub-prime mortgage debacle, banks and their brokers had an interest in attracting as many borrowers as possible, even risky ones. And Nelnet has gotten into trouble for such practices before.
...
The entire article and even the comments are well worth reading.
It’s no surprise to me that the government REFUSES to participate in this suit, but it DOES surprise me how many people STILL feel that we have a moral obligation to pay our debts.
I believe that the ONLY way to STOP the fraud and exploitation without violence is to STOP paying the bankers. The courts are corrupt, the judges are corrupt, the politicians are corrupt ...
At least half the American population is (near) judgment-proof and has NOTHING to lose by defaulting on debts for money that was created out of thin air. Once WE can create money as the banks do, we can pay our debts with the money WE created.
VOTE WITH YOUR MONEY!
