According to Business Insider, The CFPB announced on Monday that more than 23,000 consumers who were charged “unlawful advance fees” by five student debt relief businesses would receive a check in the mail from Epiq Systems — a CFPB contractor – beginning December 12.
The CFPB (Consumer Financial Protection Bureau) sued five firms in 2015. These firms are Docu Prep Center, Certified Doc Prep Services, Assure Direct Services, Direct Document Solutions, and Secure Preparation Service. The CFPB sued these firms because they allegedly deceived customers about the services they provide; This means that the firms lied to customers about things like interest rates and collecting payments for debt relief. Monster Loans and Lend Tech Loans, two affiliated mortgage firms that marketed debt relief to consumers after allegedly obtaining credit information “illegally,” according to the FTC complaint, violated the Fair Credit Reporting Act.
On the other hand, many student-debt relief firms assist borrowers in lowering their monthly payments or joining a targeted loan forgiveness program for an additional fee. Even if a company says it is related to the government and can help you get money fast, it might need to be revised. You can tell if it is not valid if the company asks for money. If the company is related to the government, it would never ask for money because it already provides that service for free.
The White House and the Department of Education have taken numerous measures to safeguard borrowers from scams and criminal activity throughout the application process since President Biden announced up to $20,000 in broad student-loan forgiveness at the end of August. The Federal Communications Commission (FCC) announced enforcement actions against a robocall campaign using Biden’s debt relief to get customers’ personal information last week, shortly after releasing new rules for telemarketers who use automated dialing systems for commercial purposes.
Robo callers especially pick up during the holiday season along with scam emails, text messages, social media messages, and fake link spams online. Meanwhile, the entire debt relief has been paused after two appeals halted its implementation. When the form was still accessible, 26 million borrowers submitted applications for loan forgiveness.
Still, the Education Department cannot disburse any student loans until the Supreme Court decides on the legality of debt forgiveness. America’s highest court will hear the cases in February, and the court will determine if GOP-led states can make a good court case.
If you think this action has affected you and have questions about payments, you can contact Epiq Systems by calling 877-899-2926 or emailing info@cfpb-monsterloans.org.
Why is the CFPB Sueing These 5 Debt Relief Companies?
The Consumer Financial Protect Bureau (CFPB) recently filed a lawsuit against five companies that allegedly violated the Telemarketing Sales Rule (TSR). The CFPB accused the companies of misrepresenting that their debt services would reduce consumers’ interest rates and improve their credit scores and falsely claiming that the U.S. Department of Education would become the servicer.
In addition to these accusations, the lawsuit further included the allegation that these five companies unlawfully collected fees for debt relief services before performing such services, violating the TSR. As a result, companies violating the TSR are viewed as severe, and the CFPB will take the proper action. Therefore, this lawsuit serves as an important reminder of the value and need for individuals to research any debt management services they may consider purchasing.
How Does Student Hires Prepare their Students for College?
Student Hires offers innovative K-12 custom-expanded learning programs that build on the strengths of disadvantaged youth in our community and equip them with career-ready skills.
Led by college students trained to mentor and inspire, these programs, which are tailored to each student’s interests, offer hands-on experiences that are sure to leave a lasting impression. With access to knowledgeable role models and purposeful guidance, we strive to empower today’s young people to make important life decisions and become successful professionals.
Conclusion
While many different debt relief companies are available to help you pay off your student loans, it’s essential to research before choosing one. Some companies charge hidden fees that can cost you more in the long run. Read the fine print and ask questions to ensure you get the best deal possible without raising more debt.