WASHINGTON–The CFPB, the Minnesota Attorney General’s Office, the North Carolina Department of Justice, and the Los Angeles City Attorney have announced an action to halt a student loan debt-relief operation allegedly engaged in unlawful conduct.
The action was taken against several related companies: Consumer Advocacy Center Inc., which does business as Premier Student Loan Center; True Count Staffing Inc., also known as SL Account Management; and Prime Consulting LLC, which is known as Financial Preparation Services. Defendants also include Albert Kim, Kaine Wen, and Tuong Nguyen, whom the Bureau alleges substantially assisted the 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.
Additional Allegations
As described in the complaint, the Bureau alleges 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 also alleges that the defendants engaged in deceptive practices by misrepresenting: the purpose and application of fees charged by the companies, their ability to obtain loan forgiveness, and their ability to lower consumers’ monthly payments.
The Bureau also alleges that the defendants failed to inform consumers the companies automatically requested that consumers’ loans be placed in forbearance so that consumers can better afford the companies’ significant fees and that the companies submit false information to student-loan servicers in loan-adjustment applications in an effort to qualify consumers for lower monthly payments. The Bureau also alleges the individuals substantially assisted the student-loan debt-relief companies.
The complaint is available at https://files.consumerfinance.gov/f/documents/cfpb_CAC_complaint_2019-10.pdf.