On April 2, 2020, the California Department of Business Oversight (DBO) announced that it filed a lawsuit against a student loan servicer servicing over 900,000 Californians as part of the DBO’s investigation into whether the loan servicer was improperly converting federal Teacher Education Assistance for College and Higher Education (TEACH)…
As a result of COVID-19’s widespread economic disruption, the student lending industry has been impacted, from financial institutions to borrowers. In the past few weeks, the federal government has sought ways to address the student loan industry and offer protection to borrowers affected by the virus. On March 20, 2020,…
On March 10, 2020, the Federal Trade Commission (FTC) announced that it obtained a permanent injunction and monetary judgment from the U.S. District Court for the Central District of California (the Court) against three defendants that allegedly deceptively marketed student loan debt relief services. The Court’s order was entered on February 27, 2020, and…
On January 17, student loan servicer Educational Credit Management Corporation (ECMC) filed a notice of appeal in the United States District Court for the Southern District of New York, challenging the decision of Chief Bankruptcy Judge Celelia Morris, which granted summary judgment for a student loan debtor and discharged his…
On January 9, 2020, the Consumer Financial Protection Bureau (CFPB) announced that it had filed a complaint against a constellation of companies for allegedly requesting credit reports without a permissible purpose in order to deceptively market sham student-loan debt relief services to consumers, in violation of the Consumer Financial Protection Act…
On December 10, 2019, the FTC announced a settlement with a major for-profit university and its parent company to resolve allegations that they deceived potential students in violation of the Federal Trade Commission Act (FTC Act), 15 U.S.C.§ 45. According to the FTC, the defendants used advertisements to attract students…
On November 12, 2019, the Federal Trade Commission (FTC) announced that on it had filed a lawsuit against a collection of interrelated companies and individual defendants for allegedly misrepresenting themselves as affiliated with the Department of Education in order to convince consumers to sign up for student loan debt relief. The…
On October 30, 2019, the Consumer Financial Protection Bureau (CFPB) announced an action to halt a student-loan debt-relief operation engaged in allegedly unlawful conduct. The CFPB filed its complaint on October 21, 2019 and requested a temporary restraining order in the U.S. District Court for the Central District of California….
On October 21, 2019, the Consumer Financial Protection Bureau (CFPB) announced that, together with the Attorneys General (AGs) of Minnesota, North Carolina, and California, it had filed a complaint and sought a temporary restraining order in the U.S. District Court for the Central District of California against a group of debt relief companies. …
On October 3, 2019, the New York Attorney General’s office (NY AG) announced that it had filed a lawsuit against a major student-loan servicer for failing to properly administer the federal Public Service Loan Forgiveness program. According to the complaint, the servicer allegedly employed deceptive, unfair, and abusive practices such…
On September 12, 2019, the Federal Trade Commission (FTC) that it had settled lawsuits against the operators of two alleged student loan debt relief schemes, and a financing company that assisted them, alleging that they had bilked millions of dollars from consumers. The FTC alleged that the defendants violated the…
On September 5, 2019, the New York Department of Financial Services (NYDFS) announced that it was launching a new investigation into the student loan debt relief industry. NYDFS stated that, as part of its “Step Up for Students” initiative, it was issuing subpoenas to eight student loan debt relief companies…
On August 12, 2019, the Consumer Financial Protection Bureau (CFPB) announced a proposed settlement with a for-profit higher-education institution. The CFPB filed a complaint against the institution in the U.S. District Court for the Southern District of Indiana on February 26, 2014, alleging that the institution had violated the Consumer…
On August 7, 2019, the Attorney General for the Commonwealth of Massachusetts (“Massachusetts AG”) announced that it filed a complaint and consent judgment in Suffolk County Superior Court. The consent judgment bans a purportedly unlicensed finance company from collecting on any active student loan debt relief accounts in Massachusetts, and requires the company to pay $340,000 to repair the…
On August 8, 2019, New York Attorney General Letitia James (“New York AG”) announced a settlement and consent order with a student loan debt relief company, resolving the complaint’s allegations that the company deceived borrowers into paying for debt relief services that are available to the public for free from the federal government…
On July 11, 2019, the Federal Trade Commission (FTC) announced that it had obtained a temporary restraining order against defendants operating an alleged student loan debt relief scheme that, according to the FTC, tricked thousands of consumers by making false claims that it would service and pay down their student…
On July 11, 2019, the Massachusetts Office of Attorney General Maura Healey announced that a for-profit educational institution and its parent company would provide over $1.6 million in debt relief to settle claims that it did not provide its students with critical information on program job placement, loan repayment, and…
On June 14, 2019, the Consumer Financial Protection Bureau (CFPB) announced a settlement with a private student loan provider that issued and managed student loans at the now-defunct for-profit ITT Technical Institute. Forty-five states including Kansas, Florida, Nevada, North Carolina, Iowa, Missouri, Kentucky, Ohio, Oregon, and New York also settled with the loan…
On February 25, 2019, the Federal Trade Commission (FTC) announced that, after a public comment period, it approved a final consent order that had been negotiated in October of 2018 with an online student loan refinancer. The FTC had charged the company with misrepresenting how much student loan borrowers could save if they refinanced their loans through the company’s television, print,…
On January 2, 2019, 49 state attorneys general reached a settlement with an Illinois-based for-profit education company, securing approximately $493.7 million in debt relief for over 179,000 students nationwide. The settlement is the result of a five-year investigation, which began in 2014 after states received complaints from students and the U.S. Senate’s Health, Education, Labor and Pensions…