Company that ‘helps’ with student finance applications sued

What the company MyStudentFinance does “may be morally reprehensible, but it is not a criminal offence”, said the Public Prosecution Service last March. Nevertheless, five international students are taking legal action. They are seeking a refund in civil court.

MyStudentFinance is a one-man business set up three years ago by an international student in Tilburg. It helps international students apply for student finance, charging high fees for its services. According to the students, this was not made clear to them in advance.

Saddled with a loan
On top of that, the five students have been saddled with a student loan without having asked for one, says their pro bono lawyer, Nadir Khalil. “Now they have to repay a loan, with interest, whilst someone else has run off with part of the money.”

Because the application process for international students takes longer than for Dutch students, the Education Executive Agency (DUO) often pays them several months’ worth of backdated student finance. The small firm skims off between forty and sixty per cent of that initial payment. As a result, four students paid “several thousand euros”, according to their lawyer. One student lost over a thousand euros.

In total, MyStudentFinance may have raked in hundreds of thousands of euros of public money. “If it’s true that around 350 students have done business with this company, as DUO previously suggested, we’re talking about a huge amount of public money,” said Nadir Khalil.

“Reprehensible”
In May, the student organisation ISO called on those affected to come forward. ISO notes that international students are in a vulnerable position, lacking a social network or knowledge of our bureaucracy. “It's reprehensible that someone would turn this into a business model,” said ISO chair Allis Richardson.

Nadir Khalil is now consolidating the cases of the first five students into a single legal proceeding, but more may follow. It could take several months before the court delivers its ruling. If these students win, it would make it easier for others to reclaim their money.

MyStudentFinance has now engaged its own lawyers. So far, it has not conceded a single millimetre to the international students’ demands. That is why Khalil is taking the matter to court. According to him, the company withheld essential information: had the students known how expensive the application assistance would be, they would never have engaged with the company.

Also in a dispute with DUO
MyStudentFinance is also embroiled in a legal battle with DUO and the Ministry of Education. Last year, DUO stopped allowing students to apply for funding through the company. The company lodged an appeal, but DUO refused to consider it. A court ruled two weeks ago that DUO is in the wrong.

The service has also reported the company for fraud and money laundering, but the Public Prosecution Service decided not to prosecute. After all, the company is not doing anything unlawful, the Public Prosecution Service concluded.

HOP contacted MyStudentFinance and one of its lawyers, but they did not answer the questions. In response to previous reports, the company sent a text message stating: “We do inform customers of our pricing in advance, not only in the service agreement but also explicitly during sign-up, as required by Dutch and EU consumer protection laws.”