Saturday, July 9, 2022

Maximus, Student Loan Debt, and the Poverty Industrial Complex by Dahn Shaulis of Higher Education Enquirer

 The Higher Education Inquirer is taking a close look at who's invested in Maximus, the enormous social welfare profiteer. Maximus has been servicing student loan defaulters for years and has now taken over Navient's federal student loan business, branding it Aidvantage

Since 1995, Maximus (MMS) has grown from $50 million in annual revenues to more than $4 billion in 2021. 

Maximus (MMS) Share Price 1995-2022
(Source: Seeking Alpha) 

With an army of more than 35,000 workers, Maximus' clients include 28 US agencies: the Internal Revenue Service, Department of Commerce, National Oceanic and Atmospheric AdministrationBureau of the Census, Patent and Trademark Office, Federal Student Aid, Department of Defense and US Army, Department of Veterans Affairs, Homeland Security, Health and Human Services, Medicare and Medicaid, Department of Labor, Office of Personnel Management, Securities and Exchange Commission and many more. 

As a contractor to Federal Student Aid (FSA), Maximus has more than 13 million student loans to service.  Its four contracts with the US Department of Education total almost $1 Billion.  

While CEO Bruce Caswell made more than $6 million in total compensation last year, Maximus' customer service representatives, the people who have to make the calls to the growing number of student loan defaulters, make less money than workers at Walmart. 

Maximus has recently posted federally contracted jobs on Indeed for $13.15 an hour in Texas and South Carolina, even though the federal minimum wage has been raised to $15 an hour. Wages for Maximus workers in other states are reportedly even lower, as little as $10 an hour in Kentucky and other states with regressive economies.   

Maximus' largest institutional investors include BlackRockVanguard Group, and State Street Corp--three financial behemoths.  BlackRock has $10 trillion in Assets Under Management (AUM), Vanguard Group has about $7 Trillion in Assets Under Management, and State Street has almost $4 Trillion in AUM. 

Bank of New York MellonWells Fargo, and Bank of America each own 900,000 shares or more. 

Public retirement funds, including public school teachers retirement funds (see table below), are directly and indirectly invested in the Poverty Industrial Complex and the student loan mess through Maximus and other large corporations. 

Maximus' strategic partners include AWSMicrosoftOracle, and Cisco.  

Social justice advocates have to wonder, how can the student loan system be fixed if the US establishment has a vested interest in the mess?  
Maximus (MMS) Top Institutional Investors 

List of Public Funds Directly Invested in Maximus

Alaska Department of Revenue 
California PERS
California State Teachers Retirement System
Colorado PERS
Florida Retirement System
Pennsylvania Public School Retirement System
Teachers Retirement System of Kentucky
Louisiana State Employees Retirement System
Ohio PERS 
New Mexico Educational Retirement Board
New York State Retirement System
New York State Teachers Retirement System
Ontario Teachers Retirement System
Oregon PERS
State of Tennessee Treasury
Teachers Retirement System of Texas
State of Wisconsin Investment Board


  1. Richard, thank you so much for posting this. Your site is an important space for student debtors to learn more about the "mess" they're in.

  2. The most egregious violation of workers’ rights has been the apparent confiscation of their retirement accounts during a plan transition. Retirement accounts have been “lost” and are now unaccounted for. The 5500 plan report for FY 2021 should be made available to each worker, and should document plan contributions and distributions – in addition, a completed Employee Benefit Audit would answer questions or assign blame for the disappearance of workers’ retirement accounts. Not all workers' have experienced this theft, however.

    As a government contractor, Maximus is obligated to contribute health insurance at a rate of 4.54 per hour (2080 hours a year) but it is not doing so. Many questions were raised when Maximus changed from Cigna to Anthem for a better rate (still unaffordable due to very high-deductibles), but apparently paid off skyrocketing “administrative” costs instead of paying for quality insurance.

    Union recruiting has reached an all-time high, with emails and texts to workers that did not expect to receive them. Recruiting in Mississippi and / or Louisiana has been noted, and anywhere Maximus workers are to be found. The disappearance of retirement accounts, withholding of wages, and other Dept of Labor violations are drawing worker interest. Class action lawsuits against Maximus are on-going.

    For example, Area Wage Determination requirements have been misrepresented even before Maximus, when GDIT ran our local site, and workers were incorrectly told that the Area Wage Determination levels were “wage levels above which pay rates could not go,” when in fact they represented wage levels below which pay rates could not go. Government contractors side-step these worker protections by down-classifying workers below actual work-experience levels. Wages are kept artificially low by classifying Customer Service Representatives as “Clerks” when in fact they are more than Clerks.

    The result, of course, is extremely low worker retention levels, as low as 6 weeks, including 2.5 week-long training, and 3 week training for more specialized Medicare claims investigations. It was reported to me that Staff levels are now the lowest they have ever been.