CFPB Sues Student Loan Debt Relief Company for Alleged TSR and CFPA Violations

CFPB sign

On March 16, 2021 the Consumer Financial Protection Bureau (CFPB) announced that it filed a complaint in the U.S. District Court for the Central District of California against a California-based student debt relief company, its owner, and manager to resolve alleged violations of the Telemarketing and Consumer Fraud and Abuse Prevention Act, 15 U.S.C. §§ 6102(c), 6105(d); the Telemarketing Sales Rule (“TSR”), 16 C.F.R. pt. 310; and the Consumer Financial Protection Act of 2010 (“CFPA”), 12 U.S.C. §§ 5536(a), 5564, 5565.

According to the complaint, the now defunct student debt relief company allegedly charged consumers illicit fees as high as $795 to file paperwork on their behalf to access otherwise free debt-relief programs available to federal student loan borrowers.  The CFPB alleged the company collected $3.5 million dollars in illicit fees from some 3,300 consumers.

The CFPB action seeks injunctive relief, consumer redress, and civil penalties as part of this lawsuit. ​