Many an Angeleno has been plagued by seemingly-inescapable student loan debt in recent years, but according to Los Angeles City Attorney Mike Feuer, high interest rates are the least of some people’s worries, thanks to debt relief scammers. Feuer announced Wednesday his move against one such scheme, which has taken tens of millions of dollars from Los Angeles graduates.
Feuer alleges that True Count Staffing, Inc has spent years operating a fraudulent student debt-relief program, one which he’s responded to with a joint civil lawsuit with the Consumer Financial Protection Bureau. The joint plaintiffs have also asked the court immediately freeze True Count assets and bank accounts.
“Students and families in L.A. and across California confront crushing student loan debt. The last thing they need is to have their burdens compounded by the so-called debt relief practices we allege here,” Feuer said. “We’re fighting… to prevent anyone else from being victimized by this alleged scam.”
According to court documents, True Count told its victims they could forgive student debts, via special relationships with the federal government and federal debt-relief programs. True Count also took payments from victims, falsely telling them payments would be applied in their entirety to any outstanding loans.
Feuer’s office said some Angelenos have fallen victim to the scame. One claims to have made monthly payments to True Count for over one year before discovering that none of the funds were sent to his actual loan servicer. Another claims to have paid them over $1,200 for promised entry into a “government-backed student loan forgiveness program” that the company never enrolled him in.