Sallie Mae (SLM) sued for allegedly misrepresenting loan‑modification effectiveness

Legal challenge centers on Sallie Mae’s loss‑mitigation claims

Sallie Mae faces a class action alleging it misrepresented the effectiveness of its loan modification and loss mitigation programs, a development that spotlights loan‑servicing practices across the student‑loan industry. On Feb. 9, 2026, DJS Law Group files a complaint in Los Angeles saying SLM Corporation, doing business as Sallie Mae, violated Sections 10(b) and 20(a) of the Securities Exchange Act and Rule 10b‑5 by issuing materially misleading statements during a July 25–Aug. 14, 2025 class period. The suit contends the company touted robust loss‑mitigation outcomes even as early‑stage delinquencies were increasing.

The allegations, if proven, raise questions about internal controls and disclosures at one of the largest private student‑loan servicers, touching on operational reporting and customer remediation processes. Regulators and investors in the loan servicing sector increasingly focus on how servicers measure and communicate the success of modification programs, particularly where performance metrics affect borrower outreach, default prevention and reserve assumptions. The complaint draws attention to the metrics Sallie Mae uses to report program effectiveness and whether those metrics reflect actual borrower outcomes.

Beyond disclosure issues, the suit underscores broader reputational and compliance risks for firms that manage large portfolios of education loans. Servicers must balance aggressive loss mitigation with transparent reporting to stakeholders and regulators; litigation alleging overstated performance can prompt reviews of servicing practices, demand changes to borrower outreach, and accelerate scrutiny from state and federal agencies. Industry participants say such cases can also catalyze operational audits and revisions to the way modifications are documented and certified.

Lead plaintiff nominations open, short deadline

DJS Law Group invites shareholders who purchased SLM shares in the specified class period to contact the firm about possible lead plaintiff appointments, noting nominations are optional and the filing deadline is Feb. 17, 2026. The announcement provides contact details for attorney David J. Schwartz at DJS Law Group in Eastchester, New York.

Firm profile and disclosure note

DJS Law Group describes itself as specializing in securities class actions and representing institutional clients including large hedge funds and alternative asset managers. The firm notes the release may be considered attorney advertising under applicable laws and ethics rules.