WASHINGTON—The Federal Trade Commission reported it is sending more than $4.1 million in refunds to people who lost money to student loan debt relief scammers who “lured consumers with fake loan forgiveness claims and pocketed their money.”
According to the FTC, the scheme used many names, including Mission Hills Federal, Federal Direct Group, National Secure Processing, and The Student Loan Group.
Complaint Filed
The FTC filed a complaint against the operators of Mission Hills Federal and Federal Direct Group in 2019, alleging that since 2014 they tricked students into paying hundreds to thousands of dollars in illegal upfront fees and pretended to lower consumers’ monthly student loan payments.
“The operators also tricked consumers into sending their monthly student loan payments directly to the defendants by falsely claiming to take over the servicing of the consumers’ loans. In reality, few payments were actually applied to consumers’ student loans and in many cases, none at all. Instead, the defendants kept consumers’ money for themselves,” the FTC said.
The FTC is sending checks to 27,584 consumers.
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