Sallie Mae Allegedly Harassed Family Of Dead College Student To Pay Up On Debt

Sallie Mae, one of the largest student lenders in the country, allegedly stalked the family of a law student who died in a car accident over the 24-year-old’s unpaid debt, raising questions about how private companies deal with the financial obligations of the deceased.

On March 31, 2013 Andrew Katbi died in a 95-car pile-up while returning to Duke from a camping trip in Virginia. Andrew was survived by his parents, sister, and long-time girlfriend, who eulogized him as an intelligent and caring person dedicated to public service, someone whose work in the Ohio Public Defender’s Office on death row cases “had been an important force in saving the lives of seven to eight clients.”

Following the tragedy, Katbi’s family sent death certificates to “all three companies that serviced Andrew’s loans — Sallie Mae, Citi, and Discover,” as Jezebel reports. “Citi and Discover immediately forgave the loans,” but Sallie Mae did not. The company rolled over Andrew’s balance to his mother, who had co-signed the loan, and began incessantly harassing the family with phone calls and voicemails, even suggesting that if the family couldn’t afford to pay back the loan, perhaps Duke University would, the family says.

Eventually, Andrew’s sister Olivia launched a Twitter campaign hoping to shame the company into backing off. On Wednesday she announced, “Thank you, everyone, for your support. Sallie Mae is now working with us,” but couldn’t share more details due to confidentiality requirements. “Oh, and my family can move on n stuff,” she added.


The tragedy highlights the difficulty of discharging private debt. In cases where the student dies, loan co-signers often are obliged to pay off the balance of the loan. While federal student loans are often discharged upon death, federal law does not require lenders to forgive private loans in those cases. While lawmakers have introduced legislation instructing lenders to properly inform students and co-signer of their obligations in instances of death, the bill does not require companies to completely forgive the loan.

Under existing rules, Katbi or his family would also have had difficulty discharging the loans if they were to declare bankruptcy. In 2009, a federal appeals court curtailed the definition of “undue hardship” for student debts, making it nearly impossible for borrowers to get out from under the debt. The debt collector for many federal student loans has been similarly accused of harassing and ruthless tactics.

As Olivia tweeted just days after reaching a settlement with Sallie Mae, “I don’t think we should be the exception to the rule, I think the rule needs to be changed. Public outrage often only way to achieve this.”