Payday Loan Debt Solution, Inc., Sanjeet Parvani
Enforcement, Debt Relief
In December 2012, the CFPB, with the states of Hawaii, New Mexico, North Carolina, North Dakota and Wisconsin, sued the Payday Loan Debt Solution corporation for “violating state and federal debt relief laws” by not providing debt relief services to customers who paid fees. Payday Loan Debt Solution was ordered to refund $100,000 to customers and pay a $5,000 civil penalty to the CFPB for allegedly collecting “$87,243.96 in upfront fees for the provision of debt relief services before the services had been rendered” which is banned by federal law.
Payday Loan Debt Solution allegedly “offered to negotiate reductions of consumers’ payday loan balances.” Payday Loan Debt Solution allegedly “collected $87,243.96 in upfront fees for the provision of debt relief services before the services had been rendered — which advance fees are banned by amendments to the federal Telemarketing Sales Rule (TSR) that took effect on October 27, 2010 — and that the company failed to comply with licensing requirements and/or fee restrictions imposed by the various states.”
“The order would ban the defendants from offering or providing debt relief services at all in Hawaii and North Carolina, and would prohibit them from charging upfront fees and otherwise failing to comply with applicable state law in the other states. The defendants must also comply with regular compliance monitoring and reporting requirements for a period of two years.”
“The proposed stipulated final judgment and order was submitted to the court yesterday in an unopposed motion for approval.” [Michael Mallow, Michael Thurman, and Michael Jahnke, “United States: CFPB Brings First Joint Enforcement Action With States Against Payday Loan Debt Relief Company,” Mondaq Business Briefing, 12/31/12]
Inactive or Resolved