Rhode Island General Laws 19-33-12. Prohibited conduct
No student loan servicer shall:
(1) Directly or indirectly employ any scheme, device, or artifice to defraud or mislead student loan borrowers;
(2) Engage in any unfair or deceptive practice toward any person or misrepresent or omit any material information in connection with the servicing of a student education loan, including, but not limited to, misrepresenting the amount, nature, or terms of any fee or payment due or claimed to be due on a student education loan, the terms and conditions of the loan agreement, or the borrower’s obligations under the loan;
(3) Obtain property by fraud or misrepresentation;
(4) Knowingly misapply or recklessly apply student education loan payments to the outstanding balance of a student education loan;
(5) Knowingly or recklessly provide inaccurate information to a credit bureau, thereby harming a student loan borrower‘s creditworthiness;
(6) Fail to report both the favorable and unfavorable payment history of the student loan borrower to a nationally recognized consumer credit bureau at least annually if the student loan servicer regularly reports information to a credit bureau;
(7) Refuse to communicate with an authorized representative of the student loan borrower who provides a written authorization signed by the student loan borrower, provided the student loan servicer may adopt procedures reasonably related to verifying that the representative is in fact authorized to act on behalf of the student loan borrower;
(8) Negligently make any false statement or knowingly or willfully make any omission of a material fact in connection with any information or reports filed with a governmental agency or in connection with any examination conducted by the department or investigation conducted by the attorney general or other governmental agency; or
(9) Fail to properly evaluate a student loan borrower for an income-driven or other student loan repayment program or for eligibility for a public service loan forgiveness program before placing the student loan borrower in forbearance or default, if an income-driven repayment or other program is available to the student loan borrower except as otherwise provided in federal law, federal student loan agreements, or a contract between the federal government and a student loan servicer.
History of Section.
P.L. 2019, ch. 199, § 1; P.L. 2019, ch. 265, § 1.
Terms Used In Rhode Island General Laws 19-33-12
- Contract: A legal written agreement that becomes binding when signed.
- Credit bureau: An agency that collects individual credit information and sells it for a fee to creditors so they can make a decision on granting loans. Typical clients include banks, mortgage lenders, credit card companies, and other financing companies. (Also commonly referred to as consumer-reporting agency or credit-reporting agency.) Source: OCC
- Department: means the department of business regulation, division of banking. See Rhode Island General Laws 19-33-2
- Forbearance: A means of handling a delinquent loan. A
- Fraud: Intentional deception resulting in injury to another.
- person: may be construed to extend to and include co-partnerships and bodies corporate and politic. See Rhode Island General Laws 43-3-6
- servicing: means :
(i)(A) Receiving any scheduled periodic payments from a student loan borrower or notification of such payments; and
(B) Applying payments to the student loan borrower's account pursuant to the terms of the student education loan or of the contract governing the servicing;
(ii) During a period when no payment is required on a student education loan, maintaining account records for the loan; and
(iii) Communicating with the student loan borrower regarding the loan, on behalf of the loan's holder; or
(iv) Interactions with a student loan borrower, including activities to help prevent default on obligations arising from student education loans, conducted to facilitate the activities described in this section. See Rhode Island General Laws 19-33-2
- Student education loan: means any loan made to a student loan borrower primarily for personal use to finance postsecondary education or other school-related expenses, and does not include an extension of credit under an open-end consumer credit plan, a reverse mortgage transaction, a residential mortgage transaction, or any other loan that is secured by real property or a dwelling. See Rhode Island General Laws 19-33-2
- Student loan borrower: means :
(i) Any resident of this state who has received or agreed to pay a postsecondary student education loan; or
(ii) Any person who shares responsibility, as a guarantor or by other legal obligation, with such resident for repaying the postsecondary student education loan for another. See Rhode Island General Laws 19-33-2
- Student loan servicer: means any person or entity who or that engages in student loan servicing as defined in this chapter. See Rhode Island General Laws 19-33-2