The Consumer Financial Protection Bureau yesterday announced it had filed suit against a number of defendants for violating the Fair Credit Reporting Act by allegedly obtaining individuals’ credit reports illegally and allegedly charging unlawful advance fees for debt relief services.
The defendants include Chou Team Realty, LLC, which does business as Monster Loans; Lend Tech Loans, Inc.; and several student loan debt-relief companies, including 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 also included a number of individuals in its suit: Bilal Abdelfattah, who is also known as Belal Abdelfattah and Bill Abdel, Thomas Chou, Sean Cowell, Robert Hoose, Eduardo Martinez, Jawad Nesheiwat, Frank Anthony Sebreros, and David Sklar.
In the complaint, the CFPB alleges that the mortgage brokerage companies obtained the credit reports from individuals under the pretense of offering them home loans, but instead they gave the reports to the student loan debt relief companies so they could promote their services to the individuals instead. The companies are accused of obtaining pre-screened lists of millions of consumers from credit bureaus.
To convince individuals to sign up for their services, some of the defendants told individuals that they would be able to get their interest rates reduced, their credit scores improved, and that the Department of Education would become their loan servicer. The defendants collected $15 million in upfront fees before individuals received any adjustments to their student loans or made any payments to the individuals’ loan servicers.
Along with the FCRA violations, the defendants are accused of violating the Consumer Financial Protection Act and the Telemarketing Sales Rule. A copy of the complaint can be accessed by clicking here
