Debt Relief Scammers Settle with FTC-Attorneys General Lawsuit

Debt Relief Scammers Settle with FTC-Attorneys General Lawsuit

Last year the Federal Trade Commission teamed up with state Attorneys General for a national sweep of debt relief schemes titled Operation Game of LoansA variety of debt relief companies from different states were sued by the FTC for violating laws with complaints filed against them in court. Of these, two settlements have been reached against various defendants.

Strategic Debt Solutions violated the FTC Act, Telemarketing Sales Rule, and Credit Repair Organizations Act by making exaggerated promises of debt reduction for student loans. They made millions from their victims and have now reached a settlement for over $17 Million. The Complaint for Strategic Debt Solutions LLC can be found here.

Bloom Law Group pretended to be part of the Department of Education to scam its student-borrower victims. The complaint listed similar violations and they reached a settlement of $9 million in monetary compensation. The complaint filed for defendant Bloom Law Group can be found here.

The FTC continues to litigate against the rest of the defendants sued during the federal-state operation. The Commission released a statement earlier today detailing the defendant’s settlements:

Strategic Student Solutions

“The FTC has obtained a settlement with an unlawful debt relief and credit repair operation for violating the FTC Act, the Telemarketing Sales Rule, and the Credit Repair Organizations Act after they allegedly bilked millions of dollars from consumers by falsely promising to reduce or eliminate their student loan debt and offering them non-existent credit repair services.  The settlement also resolves the FTC’s action against relief defendant DG Investment Properties LLC.

According to the complaint, individual defendant Dave Green and his companies – Strategic Student Solutions LLC, Strategic Credit Solutions LLC, Strategic Debt Solutions LLC, Strategic Doc Prep Solutions LLC, Student Relief Center LLC, and Credit Relief Center LLC – preyed on consumers with student loan debt by falsely promising to reduce their debt or payments through enrollment in student loan forgiveness or other programs. The defendants also falsely promised to apply monthly payments to consumers’ student loans and to improve credit scores and histories in addition to making other false claims and charging unlawful advance fees.

The defendants are permanently banned from debt relief and credit repair activities and from making misrepresentations or unsubstantiated claims related to financial or any other products or services. In addition, the order includes a monetary judgment of more than $17 million. After the defendants turn over substantially all of their assets, worth more than $4 million, the judgment will be partially suspended due to their inability to pay the full judgment.

Bloom Law Group (Defendant in FTC v. A1 DocPrep, Inc.)

The FTC has also obtained a settlement with Bloom Law Group PC (also doing business as Home Shield Network and Keep Your Home USA), one of the defendants who participated in a scheme that allegedly defrauded thousands of consumers out of millions of dollars. The FTC charged that the Los Angeles-based operation took millions from consumers through unlawful student loan debt relief and mortgage assistance relief schemes.

According to the complaint, the defendants falsely claimed to be from the Department of Education, and promised to reduce borrowers’ monthly payments or forgive their loans. The FTC also alleged the defendants targeted distressed homeowners, making false promises to consumers that they would provide mortgage relief and prevent foreclosure.

Under the settlement order, the defendants are banned from debt relief and telemarketing activities and from making misrepresentations or unsubstantiated claims related to financial or other products or services.

The order includes a judgment of more than $9 million, representing gross revenues of the defendants’ debt relief and MARS operations, minus refunds. Due to inability to pay, the order  partially suspends the monetary judgment after the defendant turns over all of its assets, $54,000.”

Full press release can be found at the FTC website here.

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