Personal Data on 3.3 Million Student-Loan Borrowers Is Reported Stolen

ECMC Group Inc., a student-loan guarantee agency in Minnesota, acknowledged on Friday a data breach in which the personal information of 3.3 million borrowers, including their Social Security numbers, was compromised.

Guarantee agencies such as ECMC are the private entities that, under the U.S. government's system of federally subsidized student loans, collect government money and then turn around and pay it to private loan companies when borrowers default on their student loans.

ECMC said in a written statement that the affected borrowers would be notified and given free credit protection and monitoring services. "We deeply regret that this incident occurred and the stress it has caused our borrowers," ECMC's president and chief executive, Richard J. Boyle, said in the statement.

ECMC's admission of the data theft came one day after Congress voted to shut down the bank-based system of student lending in favor of direct lending by the Education Department, in part because of the cost and complexity of the bank-based system. chronicle.com