Two men in Florida pleaded guilty this month to obtaining unauthorized access to the U.S. Education Department's student-lending database and to violating the federal Privacy Act by wrongfully retrieving people's records, the U.S. Department of Justice announced yesterday in a news release.
From 2005 to 2007, the news release says, a senior financial specialist at Student Funding Services, a student-loan-consolidation company in Florida, used his access to the National Student Loan Data System to look at borrowers' personal information without the borrowers' consent. The specialist, Len R. Breidert, who is 47, also improperly used other employees' passwords to gain access to the database.
Also in 2007, the news release says, three managers at another student-loan-consolidation company in Florida, University Financial Lending Services, were prohibited by the department from logging into the database because the managers had abused their access. The loan-consolidation company's marketing director, David M. Brabson, 54, then assigned other employees' accounts to the prohibited managers, so that they could continue getting accessing to the system.
Mr. Breidert and Mr. Brabson each face a maximum penalty of one year in federal prison, a fine of up to $100,000, and one year of supervised release.
The Education Department's database is confidential, but federal law lets the department grant outside access to certain lenders, college financial-aid officials, and loan-consolidation companies.
In 2007 federal agents from the Education Department's Office of Inspector General raided Student Funding Services' office, in Largo, Fla., according to the St. Petersburg Times. That year, officials at the Education Department and college financial-aid officers voiced suspicion that some student-loan companies were misusing the database to gather information about students for marketing purposes.