Exception Tracking Spreadsheet (TicklerTrax™)
Downloaded by more than 1,000 bankers. Free Excel spreadsheet to help you track missing and expiring documents for credit and loans, deposits, trusts, and more. Visualize your exception data in interactive charts and graphs. Provided by bank technology vendor, AccuSystems. Download TicklerTrax for free.
Payment processor banned by FTC
The Federal Trade Commission has issued an order permanently banning a payment processor that facilitated a fraudulent student loan debt relief scheme from processing debt relief payments. The order also requires the company and its owner to surrender $500,000 to the FTC for consumer redress.
A complaint filed by FTC alleged Automatic Funds Transfer Services, Inc. (AFTS) and its owner, Eric Johnson, processed at least $31 million in consumer payments for a fraudulent student loan debt relief scheme sued by the FTC in 2019. The debt relief scheme used numerous names, including The Student Loan Group (SLG).
AFTS and Johnson processed payments from tens of thousands of consumers deceived by SLG into paying illegal upfront fees with false promises to lower the consumers’ monthly student loan payments. The complaint cites correspondence showing that AFTS and Johnson were aware of numerous issues with the scheme. The FTC alleges that the company and Johnson received complaints from, among others, consumers and banks; were aware that SLG had high return rates and was collecting illegal upfront fees from consumers; and knew that SLG kept changing company and brand names to, among other reasons, mitigate negative publicity. Despite numerous warning signs, AFTS and Johnson continued processing consumer payments for SLG right until the scheme was ultimately shut down following an enforcement action by the FTC.
The settlement permanently prohibits AFTS and Johnson from processing payments for debt relief or student loan companies. They will also be prohibited from processing payments indirectly for any merchant that does not have a signed contract with AFTS, and will be required to apply enhanced screening and monitoring of certain high risk clients to ensure such clients are not operating illegally. The monetary judgment of $27,584,969 is largely suspended due to an inability to pay. AFTS and Johnson will be required to surrender $500,000 to the FTC, and if they are found to have misrepresented their financial status, the full amount of the judgment would be immediately due.