Operators of a $7.3 million student debt relief scam permanently banned from the debt relief industry.
Defendants falsely claimed ties to the Department of Education, promoted fake reviews, and pocketed borrower payments.
FTC imposes $7.3 million judgment, with $1 million in assets surrendered as part of settlement.
The Federal Trade Commission (FTC) has reached a sweeping settlement with the operators of a transnational student loan debt relief scam, permanently banning them from the debt relief industry and requiring them to turn over more than $1 million in personal and business assets.
The action resolves charges that the operation deceived struggling student loan borrowers and collected millions in illegal advance fees for services that were never provided.
The scam, allegedly orchestrated by Florida-based Start Connecting LLC and Colombia-based Start Connecting SAS (doing business as USA Student Debt Relief) used deceptive marketing tactics and outright lies to exploit financially vulnerable consumers.
“It is illegal for debt relief companies to make false promises and use fake reviews and testimonials to promote a business,” said Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection. “The FTC will not hesitate to enforce the law against bad actors.”
Details of the scheme
According to the FTC’s July 2024 complaint, the defendants:
Falsely claimed affiliation with the U.S. Department of Education and its official loan servicers to gain consumer trust.
Misled borrowers with promises of low, fixed monthly payments and total loan forgiveness, none of which were actually arranged.
Illegally telemarketed tens of thousands of consumers, many of whom were on the Do Not Call Registry.
Collected over $7.3 million in illegal advance fees for debt relief services that were either worthless or non-existent.
Fabricated testimonials and reviews on social media and their websites to bolster their credibility.
In reality, the companies simply pocketed borrowers’ payments and funneled a significant portion of the money to their Colombian call center, leaving borrowers no closer to debt relief.
Settlement terms and industry ban
Under the proposed court order, the defendants are permanently prohibited from:
Operating or participating in any debt relief services.
Misrepresenting any affiliation with government agencies or loan servicers.
Making deceptive claims about loan forgiveness or reduced payments.
Charging advance fees for any service.
Promoting services using fake reviews or misleading testimonials.
Engaging in unlawful telemarketing practices.
The settlement includes a $7.3 million monetary judgment, which is partially suspended due to defendants’ inability to pay the full amount. However, they must surrender over $1 million in assets. If any are later found to have misrepresented their finances, the full amount becomes immediately payable.
Advice for borrowers
The FTC urges consumers to be cautious when seeking student loan help. Assistance is available for free through StudentAid.gov, the official federal resource for loan management.
For tips on avoiding scams, visit ftc.gov/StudentLoans.
The FTC reaffirmed its commitment to protecting borrowers: “We will continue to pursue bad actors who prey on people’s financial struggles under false pretenses.”