For years, I’ve been warning people about debt relief companies. They can lead to high fees, potential damage to your credit score, and the risk of falling deeper into debt if negotiations aren’t successful. In addition, some debt relief companies are frauds.
One example is NERD Solutions.
The Federal Trade Commission, or FTC, has obtained a temporary restraining order against an alleged student loan debt relief scheme and its operators over charges they pretended to be affiliated with the U.S. Department of Education or loan servicers and falsely promised student loan debt relief that didn’t exist in exchange for illegal upfront fees.
The FTC’s lawsuit against NERD Solutions Inc. alleges that, since at least February 2022, the company and its operators illegally marketed student loan debt relief services by cold calling consumers, thousands of whom are on the National Do Not Call list, and pretending to be affiliated with the department or consumers’ actual loan servicers.
The lawsuit states that the defendants then used false claims of student loan forgiveness to lure consumers into paying illegal upfront monthly fees as high as $1,400. It also alleges the operators of the scheme have collected at least $8.8 million from consumers that are already burdened with massive student loan debt.
The defendants are charged with violating the FTC Act, the Telemarketing Sales Rule, Impersonation Rule, and Gramm-Leach-Bliley Act.
The case will be decided by the court.
