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Illinois aims to crack down on abusive student loan debt collection practices
The lawsuit alleges 15 trusts hired debt collectors that used false and incomplete documentation to shake down borrowers.
CHICAGO - Illinois joins a list of states going after abusive student loan debt collection practices.
On Tuesday, Attorney General Kwame Raoul announced his support for a lawsuit against 15 trusts that purchased student loan debt and then allegedly used illegal practices to get borrowers to pay up.
The lawsuit alleges the trusts hired debt collectors that used false and incomplete documentation to shake down borrowers.
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Attorney General Raoul said in a statement: "Unlawful conduct that is taking place in the debt collection industry inflicts untold harm on student borrowers in Illinois...Entities that profit by buying student loan debt should not be allowed to circumvent important consumer protection laws."
Last spring, Raoul urged President Joe Biden to cancel all federal student loan debt. His office also worked with the state legislature to pass a "Know Before You Owe" law to help borrowers steer clear of private predatory lenders.