CFPB sues student loan debt-relief companies

The CFPB has announced it has filed suit against several companies and individuals involved in offering student loan debt-relief services for allegedly obtaining consumer reports illegally, charging unlawful advance fees, and engaging in deceptive conduct. The Bureau’s action is against a mortgage lender called Chou Team Realty, LLC, which does business as Monster Loans (Monster Loans); an allegedly sham mortgage brokerage called Lend Tech Loans, Inc.; and several student loan debt-relief companies, including Docu Prep Center, Inc., which does business as DocuPrep Center and Certified Document Center; Certified Doc Prep Services, LP; Assure Direct Services, Inc.; Direct Document Solutions, Inc.; Secure Preparation Services, Inc.; and Docs Done Right, Inc. The Bureau is also taking action against several individuals, including Bilal Abdelfattah, who is also known as Belal Abdelfattah and Bill Abdel; Thomas “Tom” Chou; Sean Cowell; Robert Hoose; Eduardo “Ed” Martinez; Jawad Nesheiwat; Frank Anthony Sebreros; and David Sklar.

In its complaint, the Bureau alleges that between 2015 and 2017, Monster Loans violated the Fair Credit Reporting Act (FCRA) by obtaining consumer-report information for millions of consumers with student loan debt from a major credit bureau on the pretense that the company planned to use the information to offer mortgage loans to consumers when, in fact, Monster Loans provided the reports to the student loan debt-relief companies to use in marketing their services. The Bureau also alleges that, between 2017 and at least early 2019, Lend Tech Loans similarly violated the FCRA by obtaining consumer report information for millions of consumers for use in marketing student loan debt-relief services.

The Bureau further alleges that, while offering and providing student loan debt-relief services, certain defendants violated the Consumer Financial Protection Act of 2010 and the Telemarketing Sales Rule by making deceptive representations about the companies’ services.