The Federal Trade Commission (FTC) said Monday (July 22) that a federal court halted the operations and froze the assets of the operators of USA Student Debt Relief (USASDR).
The FTC asked the court to issue the order, alleging that the operators pretended to be affiliated with the Department of Education and its loan servicers and made false promises to student loan borrowers, the regulator said in a Monday press release.
The regulator’s complaint names Start Connecting LLC, Start Connecting SAS, and their owners and operators Douglas Goodman, Doris Gallon-Goodman and Juan Rojas, according to the release. The organizations collectively do business as USA Student Debt Relief.
“By pretending to be affiliated with the Department of Education and misrepresenting features of its free income-driven loan repayment programs, these scammers bilked millions from the consumers these programs were designed to help,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in the release.
USA Student Debt Relief did not immediately reply to PYMNTS’ request for comment.
The FTC’s complaint says that the defendants falsely promised permanent low, fixed monthly payments and generous lump-sum loan forgiveness; charged illegal advanced fees; and pocketed consumers’ monthly payments rather than applying them to their loan balances, according to the release.
The complaint also says that USASDR falsely marketed its services with fake testimonials and reviews on its website, on its social media pages, and on third-party consumer review platforms, the release said.
In addition, the complaint alleges that USASDR telemarketers based in Colombia placed unwanted telemarketing calls to consumers, including those on the Do Not Call Registry, and provided English-language contracts to Spanish-speaking consumers, per the release.
“We are pleased that the court preliminarily shut down this predatory operation and froze its assets, and we will continue our efforts to crack down on junk fees, unwanted calls and exploitation of consumers struggling with student loan debt,” Levine said in the release.
In an earlier case involving student loans, the FTC said in March that it was sending millions in refunds to victims of a student fraud scheme.
That case involved a fake loan forgiveness scam that used many names, including Mission Hills Federal, Federal Direct Group, National Secure Processing and The Student Loan Group.
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