On January 26, 2022, the Federal Trade Commission (FTC) announced that it resolved claims against the remaining defendants in an action concerning student loan debt relief products and services that commenced in 2019. As we previously reported, the FTC filed a complaint against a collection of interrelated companies in November 2019, alleging that they used fraudulent advertisements that suggested they were affiliated with the federal government. Additionally, the FTC alleged that the companies promised consumers they could reduce or eliminate student loan debts in exchange for illegal upfront fees. The FTC alleged that this conduct violated the Federal Trade Commission Act (FTCA) and the Telemarketing Sales Rule (TSR).
Under the terms of the proposed stipulated judgment, two of the corporate defendants agreed to a monetary judgment of $7,557,001.10, which was partially suspended due to an inability to pay after the payment of $743,386.00. Additionally, the defendants agreed to a permanent ban from providing student loan debt relief products or services.