Sallie Mae 2012 Annual Report Download - page 183

SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
14. Commitments, Contingencies and Guarantees (Continued)
We and our subsidiaries and affiliates also are subject to various claims, lawsuits and other actions that arise
in the normal course of business. Most of these matters are claims by borrowers disputing the manner in which
their loans have been processed or the accuracy of our reports to credit bureaus. In addition, our collections
subsidiaries are routinely named in individual plaintiff or class action lawsuits in which the plaintiffs allege that
those subsidiaries have violated a federal or state law in the process of collecting their accounts. We believe that
these claims, lawsuits and other actions will not have a material adverse effect on our business, financial
condition or results of operations. Finally, from time to time, we and our subsidiaries and affiliates receive
information and document requests from state attorneys general, legislative committees and administrative
agencies concerning certain business practices. Our practice has been and continues to be to cooperate with these
bodies and to be responsive to any such requests.
Contingencies
In the ordinary course of business, we and our subsidiaries are routinely defendants in or parties to pending
and threatened legal actions and proceedings including actions brought on behalf of various classes of claimants.
These actions and proceedings may be based on alleged violations of consumer protection, securities,
employment and other laws. In certain of these actions and proceedings, claims for substantial monetary damage
are asserted against us and our subsidiaries.
In the ordinary course of business, we and our subsidiaries are subject to regulatory examinations,
information gathering requests, inquiries and investigations. In connection with formal and informal inquiries in
these cases, we and our subsidiaries receive numerous requests, subpoenas and orders for documents, testimony
and information in connection with various aspects of our regulated activities.
In view of the inherent difficulty of predicting the outcome of such litigation and regulatory matters, we
cannot predict what the eventual outcome of the pending matters will be, what the timing or the ultimate
resolution of these matters will be, or what the eventual loss, fines or penalties related to each pending matter
may be.
We are required to establish reserves for litigation and regulatory matters where those matters present loss
contingencies that are both probable and estimable. When loss contingencies are not both probable and
estimable, we do not establish reserves.
Based on current knowledge, reserves have been established for certain litigation or regulatory matters
where the loss is both probable and estimable. Based on current knowledge, management does not believe that
loss contingencies, if any, arising from pending investigations, litigation or regulatory matters will have a
material adverse effect on our consolidated financial position, liquidity, results of operations or cash flows.
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