Nelnet Data Breach Class Action Lawsuit $10M Settlement Pays Up to $5,000 Cash—File Your Claim Before March 5, 2026
The $10 million Nelnet data breach settlement compensates 2.5 million student loan borrowers whose personal information was exposed in a July-August 2022 cyberattack. If you received a breach notification from Nelnet, Edfinancial, or OSLA, you can claim a pro-rata cash payment, up to $5,000 for documented losses, or up to $100 for time spent, plus 2 years of free credit monitoring. The claim deadline is March 5, 2026, and the final approval hearing is May 5, 2026.
Here’s what 2.5 million student loan borrowers never saw coming: while you were making payments on your loans, hackers were stealing your Social Security number, address, and financial data from Nelnet’s systems for over a month. Now there’s compensation available—but only if you file by March 5, 2026.
What Happened in the Nelnet Data Breach?
An unknown attacker exploited a vulnerability in Nelnet Servicing’s systems between June and July 22, 2022, gaining unauthorized access to borrower data stored on servers used by Oklahoma Student Loan Authority (OSLA) and Edfinancial Services.
The breach exposed:
- Full names, addresses, and phone numbers
- Email addresses
- Social Security numbers
- Student loan account information
- Financial details related to accounts
Nelnet discovered the data vulnerability on July 21, 2022, immediately blocked suspicious activity, and launched a forensic investigation with third-party cybersecurity experts. By August 17, 2022, the investigation confirmed that approximately 2.5 million borrowers’ unencrypted and unredacted personal information had been accessible to hackers.
The class action lawsuit, In re Data Security Cases Against Nelnet Servicing, LLC, Case No. 4:22-cv-03191 (D. Neb.), alleged Nelnet failed to implement reasonable cybersecurity measures to protect borrowers’ personally identifiable information.
Who Qualifies for the Settlement?
You’re eligible to file a claim if:
You received a data breach notification from Nelnet Servicing, Edfinancial Services, or the Oklahoma Student Loan Authority (OSLA) regarding the August 2022 data security incident
That’s it. If you got the breach notification letter or email, you’re part of the settlement class and can claim benefits.
The settlement covers all US residents whose personal information was compromised in the breach, regardless of which state you live in. You don’t need to prove you suffered identity theft or financial harm—just that your data was exposed.
How Much Money Can You Get?
The $10 million settlement fund offers multiple payment options. You must choose ONE:
Option 1: Pro-Rata Cash Payment
- Estimated $15-50 per person (depends on total claims filed)
- No documentation required
- California residents get 2x multiplier (double the payment)
Option 2: Reimbursement for Documented Out-of-Pocket Losses
- Up to $5,000 for expenses directly related to the breach
- Requires receipts and proof of losses
- Must document expenses between July 21, 2022, and March 5, 2026
Option 3: Cash Payment for Lost Time
- Up to $100 (4 hours at $25/hour)
- Requires description of time spent responding to the breach
- No receipts needed, but must describe actions taken
PLUS: Two years of free credit monitoring and identity theft protection with $1 million insurance coverage for all class members who enroll
Important: If you claim documented losses or lost time but your payment would be less than the pro-rata amount, your claim automatically converts to a pro-rata cash payment so you get the higher amount.
After deducting attorney fees (up to $3.33 million), litigation costs (up to $400,000), and class representative service awards ($15,000 total), the remaining funds pay class member claims.
What Expenses Can You Get Reimbursed?
Documented losses eligible for reimbursement up to $5,000 include:
- Credit monitoring or identity protection service fees
- Bank fees from fraudulent charges
- Costs to freeze or unfreeze credit reports
- Identity theft resolution service fees
- Lost wages from time off work to address fraud
- Certified mail, notary costs, or legal fees for fraud resolution
- Phone bills for calls related to the breach
- Mileage or travel expenses to resolve identity theft issues
You must provide receipts, bank statements, credit card statements, invoices, or other documentation proving these expenses occurred between July 21, 2022, and March 5, 2026.
How to File Your Claim (Step-by-Step)
Filing takes about 10 minutes online:
Step 1: Visit the official settlement website Go to www.NelnetSettlement.com
Step 2: Click “File a Claim” The online claim form walks you through each step
Step 3: Provide your contact information Enter your name, address, email, and phone number
Step 4: Choose your payment option Select one: pro-rata cash payment, documented losses (up to $5,000), OR lost time (up to $100)
Step 5: Upload documentation (if claiming reimbursement) Attach receipts, bank statements, or other proof of expenses. For lost time, describe actions taken and hours spent.
Step 6: Request credit monitoring Check the box to receive 2 years of free credit monitoring and enter the email where you want the activation code sent
Step 7: Submit before the deadline Claims must be submitted by March 5, 2026 at 11:59 PM Eastern Time
Prefer to file by mail? Download the PDF claim form from NelnetSettlement.com, complete it, and mail to:
Nelnet Data Security Settlement c/o A.B. Data, Ltd. P.O. Box 173032 Milwaukee, WI 53217
Postmark/Receipt deadline: March 5, 2026
You’ll receive an online confirmation after submitting your claim. Print this for your records.
Critical Deadlines You Cannot Miss
March 5, 2026: Claim Filing Deadline Submit your claim online or mail it so it’s received by this date
March 5, 2026: Objection Deadline File written objections with the court if you disagree with settlement terms
March 5, 2026: Opt-Out (Exclusion) Deadline Request exclusion if you want to preserve your right to sue separately
May 5, 2026: Final Approval Hearing The court will decide whether to grant final approval (U.S. District Court for the District of Nebraska, Omaha)
Approximately 60-90 days after final approval: Payment Distribution Checks or credit monitoring activation codes mailed once all appeals are resolved
Missing the March 5 deadline means you forfeit your right to compensation and cannot sue Nelnet, Edfinancial, or OSLA separately over this data breach.
What Data Privacy Risks Do You Face?
The exposed information creates ongoing threats:
Identity theft: Criminals can use your SSN and personal data to open fraudulent credit accounts, apply for loans in your name, or file fake tax returns
Student loan fraud: Hackers could impersonate you to change loan servicers, redirect refunds, or access your account
Financial fraud: Your information can be sold on the dark web and used for various scams for years
Phishing attacks: Criminals can use your exposed data to create convincing scams targeting you specifically
Even if you haven’t experienced fraud yet, the breach creates permanent risk. Exposed Social Security numbers don’t expire—criminals can exploit this data indefinitely.
What You Should Do Right Now
File your claim immediately at www.NelnetSettlement.com—don’t wait until March
Enroll in the free 2-year credit monitoring when you submit your claim (requires email address)
Check your credit reports for suspicious activity at AnnualCreditReport.com (free from all three bureaus)
Place a fraud alert on your credit file by contacting Equifax, Experian, or TransUnion (free, lasts one year, auto-notifies all three bureaus)
Consider a credit freeze for stronger protection that blocks new account openings
Monitor your student loan account regularly for unauthorized changes to servicer, payment plans, or contact information
Watch for phishing emails claiming to be from Nelnet, your loan servicer, or the Department of Education
File taxes early to prevent criminals from filing fraudulent returns in your name
Review financial accounts weekly for unauthorized charges
Keep your breach notification letter as proof you’re part of the settlement class
How This Settlement Compares to Other Student Loan Breaches
Recent financial services data breach settlements provide context:
OneBlood Settlement (2024): $1 million settlement, 167,400 affected, $60 cash or up to $2,500 documented losses
Equifax Settlement (2019): $425 million settlement, 147 million affected, up to $20,000 per person for documented losses
Capital One Settlement (2022): $190 million settlement, 98 million affected, estimated $100-200 per person
The Nelnet settlement of $10 million affecting 2.5 million borrowers results in modest per-person payments for the basic cash option but offers substantial reimbursement (up to $5,000) for those who documented expenses.
Student loan servicer data breaches have increased significantly, with Nelnet’s breach ranking among the largest affecting borrowers in recent years.
What Nelnet Must Do Under the Settlement
While specific security requirements weren’t fully disclosed, the settlement resolves allegations that Nelnet failed to:
Implement reasonable data security measures to protect personally identifiable information
Encrypt sensitive borrower data including Social Security numbers
Detect and prevent unauthorized access in a timely manner
Provide adequate notice to affected borrowers after discovering the breach
Nelnet denies all wrongdoing but agreed to the settlement to avoid litigation costs and uncertainty. The company has stated it immediately secured systems, blocked suspicious activity, and implemented additional security measures following the breach.
Current Settlement Status
The court granted preliminary approval to the settlement in 2024, finding it fair, reasonable, and adequate.
Final approval hearing is scheduled for May 5, 2026 in the U.S. District Court for the District of Nebraska (Roman L. Hruska Federal Courthouse, 111 South 18th Plaza, Suite 1152, Omaha, NE 68102).
You can attend the hearing or submit written objections by March 5, 2026, if you disagree with the settlement terms.
The settlement administrator will process claims and distribute payments approximately 60-90 days after the court grants final approval and resolves any appeals.
Frequently Asked Questions
What if I lost my breach notification letter?
You can still file a claim. The settlement website doesn’t require you to enter a notification ID. Just provide your contact information and confirm you received a breach notice.
Can I claim both cash payment AND reimbursement?
No. You must choose ONE payment option: pro-rata cash payment, documented losses (up to $5,000), OR lost time (up to $100). However, if your documented claim is less than the pro-rata amount, it automatically converts to give you the higher payment.
Do California residents really get double the payment?
Yes. California residents get a 2x multiplier on pro-rata cash payments due to California’s consumer protection laws. You must attest to California residency on the claim form.
Do I need receipts for the basic cash payment?
No. The pro-rata cash payment requires no documentation. Only the reimbursement option (up to $5,000) requires receipts and proof of expenses.
What if my loans were transferred from Nelnet to another servicer?
You’re still eligible if your information was compromised in the August 2022 breach, regardless of your current servicer.
Can I get both the cash payment and credit monitoring?
Yes! The credit monitoring is separate from cash payment options. All class members can request the 2-year credit monitoring service in addition to their chosen payment option.
Will filing a claim affect my taxes?
Settlement payments may be taxable income. The settlement administrator will provide appropriate tax forms (1099) if your payment exceeds IRS reporting thresholds.
Can I opt out and sue separately?
Yes, but you must request exclusion in writing before March 5, 2026. Opting out means you receive no settlement benefits but can pursue your own lawsuit.
What happens if I do nothing?
You’ll receive nothing and give up your right to sue Nelnet, Edfinancial, or OSLA over this data breach. The settlement binds all class members who don’t opt out.
How long until I receive payment?
Approximately 60-90 days after the court grants final approval on May 5, 2026 (assuming no appeals). Expect payments around late summer/early fall 2026.
Key Takeaways
The claim deadline is March 5, 2026—file immediately at www.NelnetSettlement.com
You can claim a pro-rata cash payment (estimated $15-50), up to $5,000 for documented losses, OR up to $100 for time spent
California residents get 2x the pro-rata cash payment due to state consumer protection laws
Free 2-year credit monitoring with $1 million identity theft insurance for all class members
Filing takes 10 minutes online—no receipts needed for basic cash payment
Final approval hearing is May 5, 2026—payments distributed 60-90 days later
The settlement provides compensation for the 2022 breach that exposed 2.5 million borrowers’ sensitive data. Whether you file for the cash payment, expense reimbursement, or time compensation, submitting your claim ensures you receive what you’re entitled to.
Ready to File Your Claim?
Visit the official settlement website at www.NelnetSettlement.com or contact the settlement administrator:
Phone: 1-833-XXX-XXXX (check website for number) Email: [email protected] Mail: Nelnet Data Security Settlement, c/o A.B. Data, Ltd., P.O. Box 173032, Milwaukee, WI 53217
For identity theft protection resources, visit the Federal Trade Commission’s IdentityTheft.gov for free recovery assistance.
For student loan help, visit the Consumer Financial Protection Bureau for borrower protection resources.
About the Author
Sarah Klein, JD, is a licensed attorney and legal content strategist with over 12 years of experience across civil, criminal, family, and regulatory law. At All About Lawyer, she covers a wide range of legal topics — from high-profile lawsuits and courtroom stories to state traffic laws and everyday legal questions — all with a focus on accuracy, clarity, and public understanding.
Her writing blends real legal insight with plain-English explanations, helping readers stay informed and legally aware.
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