A district court in California ordered defendants in a student loan debt relief scam to pay equitable relief and banned them from selling debt relief and telemarketing.
In a default judgment, the U.S. District Court for the Central District of California banned three defendants in a student loan debt relief scheme from telemarketing and selling debt relief and ordered them to pay $10.7 million in resolution of Federal Trade Commission allegations that they deceived consumers by promising to reduce or eliminate consumers’ student loan debt. The defendants included corporate defendants Impetus Enterprise, Inc., Fig Tree & Co., LLC, along with individual Brian Colombana.
The FTC asserted that the defendants deceptively marketed student loan debt relief services to consumers and tricked them into paying illegal upfront fees by promising to reduce or eliminate their student loan debt, and then failed to deliver the promised debt relief. The court also found that Colombana participated in the defendants’ illegal practices and knew or should have known of their misrepresentations to consumers.
The default judgment was entered because the defendants failed to answer the FTC's complaints or the summonses from the court. The court found that the FTC’s allegations established that the defendants violated Section 5(a) of the FTC Act by deceptively marketing their student loan debt relief services. They also violated the Telemarketing Sales Rule by requesting or receiving advance fees for their debt relief services and making material misrepresentations about their debt relief services. Additionally, the court stated that Colombana had authority to control and directly participated in the corporate defendants’ practices and that he knew or should have known of the misrepresentations.
The court ordered equitable monetary relief in the amount of over $8 million against individual defendant Colombana. The court also entered judgment in the amount of $10,708,206 in favor of the FTC against the corporate defendants as equitable monetary relief. Under the order, the defendants are permanently restrained and enjoined from telemarketing, as well as permanently banned from marketing debt relief products or services, or selling debt relief products and services and telemarketing. The court also instituted compliance reporting and monitoring requirements.
In 2019 the FTC obtained permanent injunctions and judgments against the other defendants in the case: Brenda Avitia-Pena, Jimmy Calderon and Capital Sun Investments, LLC, and Tuan Duong. The default judgment concludes the FTC’s recent litigation in this case.
Companies: Impetus Enterprise, Inc.; Fig Tree & Co., LLC; Noel Solutions, LLC
MainStory: TopStory DebtCollection EnforcementActions Loans
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