Feds Argue as ‘Debt Relief’ Companies Prey On Student Loan Borrowers
Fraudulent “debt relief” companies are preying on the most vulnerable of the 44 million people with student loans, as federal officials dispute who’s to blame and what to do, a NerdWallet investigation has found. U.S. enforcement agencies — the Consumer Financial Protection Bureau and the Federal Trade Commission — in recent years have closed only seven companies that lured consumers with rosy promises to reduce or forgive student loan debt. But more than 130 student loan debt relief businesses operating during the period had records of questionable or illegal behavior, according to a NerdWallet review of public records. The search of state and federal documents nationwide identified companies hit by lawsuits, court actions or negative Better Business Bureau ratings — or had owners who couldn’t manage their own debts.