The Consumer Financial Protection Bureau has issued a consent order against debt-settlement firm Premier Consulting Group LLC for charging illegal fees.
The New Jersey-based firm was fined $69,075 for charging upfront fees before providing any actual debt settlement services.
In May 2013, the CFPB filed a complaint in federal district court against Premier and another debt-settlement service provider, Mission Settlement Agency. Several other related entities were named in the 2013 complaint, including the Law Office of Michael Lupolover, another New Jersey firm also named in the CFPB’s settlement with Premier.
The CFPB settled its civil case against Mission Settlement and its owner earlier this year. In November 2014 the owner of Mission Settlement was sentenced to nine years in prison after pleading guilty to conspiracy charges of mail and wire fraud.
The CFPB alleged that Premier and the Lupolover Firm routinely charged consumers upfront fees before settling their debts. Those fees and the companies’ subsequent failure to provide effective services often caused consumers to fall further into debt, harming their credit history in the process, the bureau said. The two companies, both of which have customers in multiple states, were in violation of the Federal Trade Commission’s Telemarketing Sales Rule, the bureau said.
Under the terms of the settlement, Premier will pay a civil penalty of $69,075. That sum represents the amount of advance fees the companies took from consumers who did not have any debt settled.
“These companies took advantage of consumers in financial distress, charging tens of thousands of dollars for services they failed to deliver,” said CFPB Director Richard Cordray. “Charging upfront fees for debt-settlement services is against the law, and today’s action is another reminder that these illegal practices will not be tolerated.”