Student Loan Debt Relief Scheme
The defendants in two student loan debt relief cases agree to settle Federal Trade Commission claims against them. The FTC illustrates the defendants charge consumers illegal upfront fees and falsely promise to help reduce or forgive student loans. According to the complaint, the individual defendant Dave Green and his companies prey on consumers with student loan debt by falsely promising debt reduction and student loan forgiveness.
The FTC settlements are with Strategic Student Solutions and the Bloom Law Group. Both firms are subjects of a coordinated federal-state law enforcement initiative targeting deceptive student loan debt relief scams. The law enforcement action is appropriately named “Operation Game of Loans.”
Strategic Student Solutions
The FTC is successful in obtaining a settlement under the following premises. The firms violate the FTC Act by engaging in an unlawful debt relief and credit repair operation. Furthermore, the defendant firms break the Telemarketing Sales Rule and the Credit Repair Organizations Act. Specifically, the firms swindle millions of dollars from consumers by falsely promising to reduce or eliminate their student loan debt. In like manner, the firms also offer consumers non-existent credit repair services.
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 surrender their assets of more than $4 million, the judgment is in partial suspense due to their inability to pay the full judgment.
Bloom Law Group Pretending To Be The Department of Education
The FTC also obtains a settlement with the Bloom Law Group. The FTC charges that the Los Angeles-based law group takes millions from consumers through unlawful student loan debt relief and mortgage assistance relief schemes. Not only that, the Bloom Law Group falsely claims to be from the Department of Education. In their illegal discourse, they promise to reduce borrowers’ monthly payments and forgive their loans. Further, the defendants target homeowners in distress and make false promises to provide mortgage relief and prevent foreclosure.
Under the FTC settlement order, the defendants receive a lifetime ban from debt relief and telemarketing activities. Moreover, they may not make misrepresentations or untruthful claims relating to financial or other products and services.
The FTC order includes a judgment of more than $9 million, representing gross revenues of the defendants’ debt relief and other operations, minus refunds. Due to inability to pay, the order partially suspends the monetary judgment after the defendant turns over all of its assets, a measly $54,000.