SLM Escapes FCA Suit Over Forbearance Practices

Law360, New York (September 28, 2010, 4:07 PM EDT) -- SLM Financial Corp., parent company of student loan giant Sallie Mae, has dodged a qui tam suit accusing it of obtaining federal guarantees by concealing an unlawful forbearance policy in violation of the False Claims Act.

Judge Richard Leon dismissed the suit Monday in the U.S. District Court for the District of Columbia, saying it was barred by the FCA's "first-to-file" rule on account of nearly identical claims already lodged in another district.

The latest suit, brought by former SLM loan associate Sheldon Batiste, accused the...
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