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CFPB Announces Action Against Student-Loan Debt-Relief Companies
On Wednesday, October 30, 2019, the CFPB, in coordination with the Minnesota Attorney General, North Carolina Department of Justice, and the Los Angeles City Attorney, announced an action to stop alleged unlawful conduct by several related student-loan debt-relief companies. The Bureau alleges that since at least 2015, the debt-relief companies operated as a common enterprise and deceived thousands of federal-student-loan borrowers and charged over $71 million in unlawful advance fees in connection with the marketing and sale of student-loan debt-relief services to consumers.
As described in the complaint, the Bureau alleges that Premier, along with its company co-defendants, violated the Consumer Financial Protection Act of 2010 (CFPA) and the Telemarketing Sales Rule (TSR) by making deceptive representations about the companies’ student-loan debt-relief and modification services. Specifically, the complaint alleges that Premier charged and collected improper advance fees before consumers had received any adjustment of their student loans or made any payment toward such adjusted loan.
The Bureau’s complaint seeks an injunction against defendants, as well as damages, redress to consumers, disgorgement of ill-gotten gains, and the imposition of civil money penalties. The complaint also names several defendants in order to obtain relief, and seeks disgorgement of those relief defendants’ ill-gotten gains. The complaint is not a finding or ruling that the defendants have violated the law.
The complaint is available at: https://files.consumerfinance.gov/f/documents/cfpb_CAC_complaint_2019-10.pdf