Nelnet paid a $25,000 penalty after collecting payments on 1,114 Connecticut loans without a required small loan company license.
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Student loan servicer Nelnet Servicing LLC collected payments on more than 1,100 Connecticut loans over more than four years without a license the state says it needed.
The Lincoln, Nebraska-based company, which does business as Firstmark Services and Sloan Servicing, agreed to pay a $25,000 civil penalty under a consent order issued Aug. 7 by state Banking Commissioner Jorge L. Perez. Nelnet also paid $800 in back licensing fees.
According to state Department of Banking examiners, Nelnet received payments on at least 1,114 small loans between Jan. 1, 2022, and March 25, 2026, without holding a Connecticut small loan company license.
Nelnet obtained the license March 25, the same day the state says the violations ended.
The company neither admitted nor denied the allegations.
In a statement, Nelnet spokesman Ben Kiser said the company appreciates "the Connecticut Department of Banking's cooperation throughout this process."
"The matter involved a licensing issue relating to certain servicing activities and did not impact borrowers in any way," Kiser said. "Nelnet obtained the appropriate license and the matter has been resolved."
The consent order does not allege that borrowers were overcharged or otherwise harmed. It also does not cite any consumer complaints related to the licensing issue.
Nelnet has been licensed in Connecticut as a student loan servicer since November 2016. It also has been registered as a federal student loan servicer in the state since August 2021.
The small loan company license is a separate credential from the student loan servicing license, according to the consent order.
Under the agreement, Nelnet also must verify that creditors for which it services loans are licensed or exempt from licensing requirements in Connecticut. The company must obtain that verification in writing before entering new servicing agreements, check it annually against state licensing databases and retain the records for at least two years.
William J. Munn, secretary of Nelnet Servicing, signed the consent order Aug. 6.
