March 30, 2007

Lawsuit Accuses Education Department of Overbilling on Student Loans

By KARIN FISCHER

The U.S. Department of Education has routinely charged some borrowers erroneous late fees on their consolidated student loans, according to a lawsuit filed in federal court here last week.

The lawsuit alleges that the Education Department has made a "systematic practice" of imposing financial penalties on borrowers even though their payments were made on time. The department has not fixed the problem, despite repeated complaints, the suit says.

The complaint, which seeks

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