The Consumer Financial Protection Bureau says the Department of Education is blocking access to documents it needs for its lawsuit against Navient, one of the nation’s biggest student loan servicers.
The CFPB sued Navient last year, claiming the company misled borrowers and processed their payments incorrectly.
The agency asked a federal judge this week to order Navient to produce the documents as part of its discovery process, according to a court filing.
But Navient says it needs the Department of Education’s permission to release the information because of privacy laws, according to court filings. The department has not granted permission, according to the CFPB’s letter.
The consumer agency says it needs these documents to identify the consumers affected. It is seeking debt relief for borrowers who were allegedly harmed by Navient’s practices.
It argues that the privacy law should not be used to “resist discovery of relevant information” and that a court can order Navient to hand over the records.
Spokespeople for the CFPB and the Department of Education could not immediately be reached for comment.
A Navient spokesperson said that the company’s contract with the government requires it to obtain approval from the Department of Education before sharing borrower data.
“After five years of searching for evidence to support their claims, the CFPB has found none. This request, for virtually all Education Department borrower records, is an attempt to allow the search to continue and demonstrates yet again why the suit should never have been brought,” she said.
Last year, the department ended an information-sharing agreement it had with the CFPB concerning oversight of private companies that have contracts with the government to service federal student loans. At the time, it accused the CFPB of overreaching.
CNN’s Donna Borak and Juana Summers contributed reporting for this story.