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A coalition of attorneys general from a dozen states is urging the Consumer Financial Protection Bureau (CFPB) to promptly distribute $4.2 million in redress payments owed to former students of Prehired LLC, a shuttered sales-training firm. The CFPB delays $4.2 million redress checks, state officials say, leaving hundreds of consumers in limbo nearly a year after the agency committed to the relief.

In a formal letter sent Monday to Acting CFPB Director Russell Vought, the state officials expressed deep concern over the bureau’s failure to issue payments and its recent lack of communication. The letter emphasizes that despite finalizing the $4.2 million distribution from the CFPB’s civil penalty fund in May 2024, no checks have been sent to impacted individuals.

"The CFPB committed to provide relief to these consumers when it made the allocation from the civil penalty fund," the officials wrote. "During these increasingly difficult economic times, hundreds of Americans look to your leadership to deliver on this commitment."

The letter was signed by attorneys general from Washington, New York, Illinois, Colorado, Delaware, Massachusetts, Minnesota, North Carolina, Ohio, Oregon, South Carolina, and the commissioner of California’s Department of Financial Protection and Innovation.

The funds were earmarked following a November 2023 settlement with Prehired LLC, which was accused of deceptive marketing and illegal debt collection tied to income-share agreements (ISAs). The settlement, entered through Prehired’s bankruptcy proceedings, required the cancellation of outstanding ISAs and outlined that refunds would be made possible through the CFPB’s penalty fund.

Initially, the CFPB worked closely with state regulators to confirm eligible recipients. However, according to the letter, the agency ceased substantive communication in February 2025 and has not responded to follow-up inquiries, including a March 12 email seeking an update on the distribution timeline.

The state officials are calling on Vought to prioritize the redress effort and provide a clear timeframe for the release of payments, highlighting that former students span nearly all 50 states.

The CFPB has not issued a public response.

This plea arrives amid ongoing downsizing at the agency and proposed Congressional efforts to limit the CFPB’s ability to use penalty funds for victim compensation. Critics argue such restrictions could hinder consumer protection and financial justice nationwide.