Perhaps that's why Navient stock did not falter on the news. In midafternoon trading, it was up a little more than 1% at $15.98. Since the beginning of the year, it's down 2.7%.

Navient services more than $300 billion in federal and private student loans for more than 12 million borrowers, which is equivalent to about one-fifth of the $1.4 trillion in outstanding student loan debt and a little more than a quarter of the 44 million borrowers.

The CFPB is suing Navient and two subsidiaries: Navient Solutions, which is responsible for loan servicing operations, and Pioneer Credit Recovery, which collects on defaulted student loans.

The state attorneys general of Washington State and Illinois are also suing Navient and its subsidiaries for abuses in loan servicing options, but those suits were filed in their respective state courts. The CFPB suit was filed in U.S. District Court for the Middle District of Pennsylvania.

In its lawsuit the CFPB paints a picture of a loan servicer that has taken advantage of student loan borrowers in order to maximize its own profits at the expense of those borrowers. It charges Navient with:

Repeatedly misapplying or misallocating borrowers' payments and failing to correct those errors. For example, Navient would allocate a payment across a number of a borrower's loans rather than paying off a particular loan first, which the borrower had instructed it do.

Steering many borrowers into costlier repayment options, such as forbearance, which delays payments while interest continues to accrue rather than into other options such as a repayment plan with lower payments or deferment, which delays payments as well as interest charges. According to the CFPB, Navient's practices added $4 billion in interest charges to the principal balances of borrowers enrolled in multiple, consecutive forbearance when a large portion of those charges could have been avoided.

Obscuring information that borrowers need to maintain lower payments. Navient failed to inform borrowers enrolled in income-driven repayment plans about critical deadlines to recertify their income and family size annually. As a result, many borrowers lost their enrollment in their plans and found a monthly payments jump by hundreds or thousands of dollars, and some lost the progress toward loan forgiveness.

Deceiving private student loan borrowers about requirements to release co-signer from a loan. Navient told borrowers that they could apply to release a co-signer from their loan if they made a certain number of consecutive on-time payments, but if those borrowers prepaid and skipped a payment (which they were told they could do), Navient reset the number of consecutive payments made (to zero). Those borrowers had to start over to meet the requirements to release a co-signer.

Hurting the credit of disabled borrowers, including injured veterans. Severely and permanently disabled borrowers can seek loan forgiveness under the federal Total and Permanent Disability discharge program, but Navient reported to credit reporting companies that those borrowers had defaulted on their loans, which damaged those borrowers' credit reports.

Navient, in a statement, rejected the CFPB's allegations as "unsubstantiated, unjustified and politically driven," noting that the CFPB lawsuit was filed on "the eve of a new administration."

It said charges that it failed to educate borrowers about income-drive repayment plans "ignore the facts" and the federal loan borrowers it services are 31% less likely to default than their peeers at other servicers.

"The suit improperly seeks to impose penalties on Navient based on new servicing standards applied retroactively and applied only against one servicer… standards [that] are inconsistent with Department of Education regulations, and will harm student loan borrowers, including through higher defaults."

The company pledged to "vigorously defend" itself against "false allegations and continue to help our customers achieve financial success."