The Consumer Financial Protection Bureau 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 action is against a mortgage lender called Chou Team Realty, LLC, which does business as 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.
As described in the complaint, the CFPB alleges that between 2015 and 2017, Monster Loans violated the Fair Credit Reporting Act 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.
While offering and providing student loan debt-relief services, certain of the defendants allegedly violated the Consumer Financial Protection Act of 2010 and the Telemarketing Sales Rule by making deceptive representations about the companies’ services. Specifically, they misrepresented to consumers that they would have their interest rates reduced, have their credit scores improved, and that the U.S. Department of Education would become their servicer. The bureau also alleges that certain defendants unlawfully charged and collected at least $15 million in fees before consumers received any adjustment to their student loans and made any payments toward their adjusted loans.
The complaint was filed in the U.S. District Court for the Central District of California on Jan. 9, 2020. It seeks an injunction against the defendants, as well as damages, redress to consumers, disgorgement of ill-gotten gains, and the imposition of civil money penalties. It also names several defendants in order to obtain relief and seeks disgorgement of those relief defendants’ ill-gotten gains.