You are here

Big FTC win against student loan debt relief firm

Share this page

Just about a year ago, we told you about a case the FTC brought against a student loan debt relief firm. The FTC alleged that the operators of Mission Hills Federal, Federal Direct Group, National Secure Processing, and The Student Loan Group bilked borrowers out of millions of dollars. The FTC said the companies lured people with false promises to pay down student loans and lower monthly payments. The FTC also claimed the companies lied about taking over the servicing of the loans, which tricked people into submitting loan payments directly to them. In fact, the defendants diverted borrower payments to themselves.

Today, we have some great news to share: a federal court in California has ruled in our favor. What does that mean? The defendants will be permanently banned from the telemarketing and debt relief businesses. What’s more, the ruling also imposes a $27.6 million judgment. The portion of that amount collected by the FTC may be used to refund people affected by the defendants’ scheme. Stay tuned for more information on possible refunds.

If you or someone you know feels overwhelmed by student loan debt, know this: It’s illegal for companies to charge you for debt relief services before they help you, and some of the companies that promise relief are scams. If you have questions about federal student loans, start with StudentAid.gov/repay. If you have private loans, talk with your loan servicer. For more information, check out ftc.gov/StudentLoans.

Here are a few tips to help avoid debt relief scams.

Learn more about what the FTC is doing to help protect consumers. Sign up for our consumer alerts.

 

Tagged with: debt, loan, scam, student
Blog Topics: 
Money & Credit

Comments

Ms. Tressler: Thank you so very much for this wonderful news. As a retiree with 46 years of experience of College Recruiting/Relations for two major Aero-Space companies, I am so happy to hear the result of FTC's fantastic work on behalf of these young people.

it's wonderful to hear that these scammers were dealt with and innocent people will get refunded!

Good advice

I now know I have played into the hands of sooooo many scams. It's not even worth backtracking at this point. I will never give out my information again unless I reverify the sources. To this day, I am getting scam calls that never seem to end. I changed my number in Feb 2020 yet I am still being contacted. Insanity.

Docuservice.us is one of these companies and they have all of my information.

Leave a Comment