The FTC announced this past week that it (along with multiple states) has cracked down on companies that have been allegedly scamming consumers when it comes to getting help for their student loan debt. We are so excited to see this action take place because there are a lot of unscrupulous companies that advertise “help” and just scam consumers.
We've shared multiple times here on the blog what you need to know:
But sadly, people are still falling victims to these companies. In fact, the FTC has found that the 30 companies they charged this past week defrauded borrowers of $95 million! If you think about the fact that most of these companies charge about $1,000 per customer, they've potentially taken advantage of over 95,000 people!
We're going to show you exactly what companies the FTC has taken action against, our past interactions with these companies if we've seen them before, and what steps you can take if you're a victim of working with any of these companies.
What Did These Companies Do To Scam Consumers?
It's important to note that there is a big difference between a scam and paying for something that you don't need. There are some cases where it can make sense to pay a professional for student loan debt help. However, a true company that is helping you will take certain steps and follow the law.
These companies scammed consumers. They did the following:
- Claimed to be from the Department of Education or working with the Department of Education (only your lender works with the Department of Education)
- Falsely promised to lower payments or forgive loans (no company can promise this)
- Falsely promised to reduce student loan interest rates (these don't change)
- Falsely claimed that payments made to these companies were going towards the borrowers' student loan debt
- Encouraged borrowers not to make payments on their loans and not to contact their lenders
- Violated telemarketing sales law
- Responded to mounting consumer complaints by changing their name rather than their business practices
What Companies Were Involved In These Scams?
Here is the list of companies that were involved in these scams according to the most recent FTC crackdown. We've seen many of these companies mentioned before by our readers in our Student Loan Debt forum. We encourage everyone to share your story in our forums so that others can avoid any companies that may be operating illegally.
A1 Doc Prep
In an action filed in the U.S. District Court for the Central District of California, the FTC charged that Los Angeles-based A1 DocPrep took at least $6 million from consumers through unlawful student loan debt relief and mortgage assistance relief schemes. According to the complaint, the defendants claimed to be from the Department of Education, and promised to reduce borrowers’ monthly payments or forgive their loans. The FTC also alleges the defendants targeted distressed homeowners, making false promises to consumers that they would provide mortgage relief and prevent foreclosure. Rather than helping consumers, A1 DocPrep’s CEO, defendant Homan Ardalan, spent hundreds of thousands of consumers’ dollars on cars, jewelry, nightclubs, and restaurants, according to the FTC.
We had a reader call out A1 Doc Prep in our forum a year ago!
Academic Aid Center
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Academic Aid Center has been mentioned multiple times in our forums – one of the biggest concerns people have had about companies.
Academic Discharge
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Academic Discharge has been mentioned before in our forums.
Academic Protection
This is the same company as Alliance Document Preparation that we mentioned above.
Academy Doc Prep
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Academy Doc Prep has been mentioned before in our forums.
Alliance Document Preparation
This company allegedly took more than $20 million from consumers by charging illegal upfront fees of up to $1,000. This company operated under a bunch of different names which we list here. It's crazy to think how many aliases this companies are working under.
Allied Doc Prep
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Allied Doc Prep has been mentioned before in our forums.
Alumni Aid Assistance
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Alumni Aid Assistance had been mentioned before in our forums.
American Student Loan Consolidators (ASLC)
This company allegedly scammed student loan borrowers out of at least $11 million by falsely promising loan forgiveness, lowered monthly payments, and reduced interest rates.
Bloom Law Group
This is the same company as A1 Doc Prep that we mentioned above. They were just using a different name.
Capital Advocates
This is the same company as Student Debt Relief Group that we mentioned. They were just using a different name.
Elite Consulting Services
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Elite Consulting has been mentioned in readers comments before.
Elite Doc Prep
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Elite Doc Prep has been mentioned in readers comments before.
First Grad Aid
This is the same company as Alliance Document Preparation that we mentioned above.
First Student Aid
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. First Student Aid has several concerns in our forum.
Grads Doc Prep
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Grads Doc Prep was mentioned in our forum and reader comments on articles.
Grads United Discharge
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Grads United Discharge was mentioned in our forum and reader comments on articles.
Post Grad Aid
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Post Grad Aid was mentioned in our forum and reader comments on articles.
Post Grad Services
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Post Grad Services was mentioned in our forum and reader comments on articles.
Premier Student Aid
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. Premier Student Aid was mentioned in our forum and reader comments on articles. It has been one of the most mentioned companies we've seen.
Project Uplift Students
This is the same company as A1 Doc Prep that we mentioned above. They were just using a different name.
SBS Capital Group and SBS Holdings
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name.
Strategic Student Solutions
Strategic Student Solutions allegedly took more than $11 million from consumers by falsely promising to reduce or eliminate their student loan debt and offering them non-existent credit repair services. They were mentioned in our forum here: Strategic Student Solutions scam.
StuDebt
This is the same company as Student Debt Relief Group that we mentioned. They were just using a different name.
Student Aid Center
Student Aid Center misled consumers to believe that they could receive loan forgiveness or modification if they paid unlawful upfront fees, and tricked consumers into thinking the operation was involved in the approval process. Student Aid Center was mentioned in multiple comments on our site.
Student Debt Doctor
Student Debt Doctor falsely promised consumers loan forgiveness often in as little as five years or less, and told consumers not to communicate with their loan servicers. The defendants also fabricated income, unemployment status, and family size information on relief applications in order to qualify borrowers for eliminated or reduced monthly payments.
Student Debt Relief Counselors (SLRC)
This is the same company as Student Debt Relief Group that we mentioned. They were just using a different name.
Student Debt Relief Group (SDRG)
The Student Debt Relief Group falsely claimed to be affiliated with the Department of Education, deceived consumers into paying up to $1,000 in illegal upfront fees to enter them into free government programs, and charged consumers monthly fees they claimed would be credited toward their student loans.
United Legal Center
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. This company was mentioned in reader comments about United Legal Center here.
United Legal Discharge
This is the same company as Alliance Document Preparation that we mentioned above. They were just using a different name. United Legal Discharge has been mentioned multiple times in our forums.
What You Need To Know About Operation Game Of Loans
It's great to see that the Feds took action with Operation Game of Loans. However, this is only the tip of the iceberg. If you've spent any time looking at student loan scams, and seeing the complaints about student loan companies, you know there are hundreds more companies just like these out there. And sadly, many more will likely pop up to fill the void that these companies are leaving behind.
The best thing that you can do if you have student loan debt is protect yourself from scammers. If you've already been scammed, here's some steps that you can take now to get back on track.
How To Protect Yourself From Student Loan Scams
All of these companies have things in common – they promise lower payments or forgiveness (which they can't do), they claim to be affiliated with the Department of Education (which is a lie), and they take money up front and don't do the job you paid them for.
So, how do you protect yourself?
It's pretty easy!
First, you can do everything you want to do with your student loans for free by calling your lender directly or going online to StudentLoans.gov.
Second, if you're one of the few people who might want to pay for student loan help, make sure you fully vet the company you're going to work with and understand what work you're paying them to do. Here's our guide to protect yourself: How To Know If Your Student Loan Company Is Going To Scam You?
Conclusion
There are a lot of bad actors in the student loan debt help space. Operation Game Of Loans is a starting point, but honestly consumers need to make sure they are protecting themselves. Never pay money up front for help if you don't know what you're getting. And remember, you can do most things with your student loan debt for free at StudentLoans.gov!
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