A student loan debt relief company is being told they're not allowed to do business in Maryland.
Maryland Attorney General Brian Frosh announced that the Consumer Protection Division issued a cease and desist order against Student Loan Counsel. The California-based company must cease any unlawful conduct in Maryland, return all money collected from Maryland consumers, and pay damages to those affected by their illegal conduct.
Student Loan Counsel is also barred from doing any further business in Maryland without posting a
$100,000 bond to protect consumers.
According to the order, the student loan debt relief company promised to help consumers obtain fast debt forgiveness and lower monthly payments for an advance fee of $599 and around $39 per month throughout the entire remaining loan term. Student Loan Counsel then failed to deliver those services and refused to refund its customers.
Student Loan Counsel also didn't have the proper licenses.
ABC2 reached out to Student Loan Counsel for comment but didn't immediately hear back.
The recent crackdown is part of a nationwide effort called "Operation Game of Loans."
Federal and state law enforcement agencies are working together to target deceptive student loan relief scams. So far, the Federal Trade Commission and various attorneys general have taken 36 actions. The FTC estimates that scammers have collected more than $95 million in illegal upfront fees from American consumers.
To avoid falling victim to a student loan scam, the FTC recommends never paying an up-front fee. It's illegal for companies to charge you in advance before helping you.
Only scammers promise fast loan forgiveness. Scammers may tell you they can get rid of your debt fast before knowing anything about your situation.
Be wary of official-looking names and logos. A Department of Education seal doesn't mean a company is legitimate.
And don't share your FSA ID with anyone. Scammers can get into your account and steal your personal information.
Also, if you spot a scam, you're encouraged to report it to the FTC. Click here to file a complaint.
