The Consumer Financial Protection Bureau on Friday announced it had filed a lawsuit against a debt settlement company and its owners for allegedly taking money from customers before achieving the results it promised and deceiving individuals about “material aspects” of the services it provided.
A copy of the complaint, filed in the District Court for the Northern District of Illinois, Eastern Division, can be accessed by clicking here.
The defendants — FDATR, Inc., and its owners, Dean Tucci and Kenneth Halverson — are charged with violating the Telemarketing and Consumer Fraud and Abuse Prevention Act, the Telemarketing Sales Rule, and the Consumer Financial Protection Act.
Consumers were charged between $1 and $99 initially before the defendant would send over any initial documents, to ensure it had a valid payment method on file, according to the complaint. Then, it would allegedly charge consumers a one-time fee of $499 within the first few weeks of enrollment or $600 in installments over a three-to-six month period.
For all of that, the defendant allegedly would file loan consolidation paperwork with the Department of Education, if it did anything at all, according to the complaint. As noted by the CFPB in its complaint, loan consolidation “does not achieve the results” that the defendant promised, such as lowering payment amounts and improving credit scores. In fact, the defendant never tracked whether the services it provided achieved the results it claimed it would.
The complaint did not indicate how many consumers were harmed by the defendant’s actions, but the CFPB did say in a press release announcing the suit that the alleged actions took place between 2011 and 2019.
The CFPB is seeking to permanently enjoin the defendants from further violations of the Telemarketing Sales Rule and the Consumer Financial Protection Act, monetary damages, and redress to those who were victimized by the defendant’s actions.
