What Is Conduent (ACS) Education?

Young woman working on student loan applications at home
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DEFINITION

Conduent Education Services (formerly ACS Education Services) was a student loan company that serviced campus-based, private, and federal student loans. It shut down operations on September 1, 2019, and all of its loans were transferred to other loan servicers.

Definition and Examples of Conduent Education Ownership

Conduent has gone through many name changes and ownership transfers over the years. Xerox acquired Affiliated Computer Services (ACS) in 2009, including the student loan arm, ACS Education Services, also called ACS Education Solutions or ACS Student Loans. ACS had a contract with the U.S. Department of Education to service federal student loans at the time of this acquisition.

The Department of Education chose not to renew ACS’s servicing contract in 2012. Direct loans serviced by ACS were transferred to other federal student loan servicers. ACS Education Services continued to service some Federal Family Education Loans (FFEL), Perkins loans, and private student loans.

“Servicing” includes consolidating loans, billing borrowers, processing payments, processing deferment or forbearance applications, and helping borrowers make account changes, such as switching repayment plans.

How the Termination of Conduent Loans Worked

After an investigation initiated in 2015, the Massachusetts Attorney General alleged that ACS Education Services had failed to properly handle borrowers’ applications for income-based repayment plans. This would have helped borrowers secure lower monthly payments. The AG also claimed in a 2016 statement that ACS had “engaged in harassing debt collection practices,” with some borrowers receiving excessive phone calls from the servicer.

ACS agreed to pay $2.4 million in fines to Massachusetts as a result of this investigation. It also agreed to end illegal and abusive debt collection practices and to make reparative efforts such as crediting wrongfully charged late fees.

The U.S. Consumer Financial Protection Bureau (CFPB) investigated ACS in 2014 and 2015. It found that some student loan accounts hadn’t been properly updated. It had incorrect principal balances. The CFPB alleged that ACS lacked a proper system and manpower for processing changes to repayment, such as deferment, forbearance, or income-based repayment plans.

ACS and the CFPB agreed on a remediation plan in 2015. It included properly adjusting relevant loans or making restitution to borrowers. The CFPB fined ACS $3.9 million for the errors. “The company neither admitted nor denied liability,” Conduent told The Balance.

Xerox shed several business interests in 2017 and created the publicly traded company Conduent Incorporated. That was when ACS became Conduent Education Services, which handled student loan servicing from 2017 forward.

Conduent moved to start winding down all student loan servicing operations for FFEL loans. “As previously communicated in our public disclosures, the company decided to exit the student loan servicing business,” Conduent confirmed with The Balance. "It completed its exit from this business in 2018."

Conduent's student loans business is no longer in operation. All Conduent student loans that were previously serviced have been transferred to other services.

Do I Need to Pay My Conduent Loans?

What does all of this mean for the borrowers with whom Conduent previously worked? Borrowers should proceed in one of two ways depending on their type of loans.

  • For Federal Perkins Loans and other campus-based loans: Borrowers should have received contact from the college through which they received these loans, indicating their change of student loan servicer. Reach out to the loan-issuing college or school for information if you haven't yet done so.
  • For FFEL and private student loans: Borrowers are advised to look up these loans through the National Student Loan Database System (NSLDS) via the Federal Student Aid website. Log in with your FSA credentials to review your student loans. You can click on a loan number to view details, such as your new servicer and its contact information.

The CFPB’s consent order requires Conduent to adjust loan balances. It must make restitution to any affected borrowers. Contact your new student loan servicer and discuss the matter with them if you believe this applies to you but your loans were not adjusted. You might also want to check on your loan balance, review your previous payments, and request a free copy of your credit report to ensure that it is accurate.

Key Takeaways

  • Conduent, formerly known as ACS Education Services, is no longer servicing student loans.
  • The CFPB ordered the company to correct unfair loan servicing practices by adjusting principal balances and repaying affected borrowers.
  • Contact your lending institution or look up your loan information on the Federal Student Aid website if you had your student loans serviced through Conduent. This will tell you where your loans have been transferred.

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