CFPB Orders to Shut Down Student Loan Processing.USA
On March 15, the CFPB announced its termination of a student debt relief program, Student Loan Processing.US. The federal district court is to come to a final decision on shutting down the company that has illegally charged students millions of dollars in upfront frees in exchange for student loan services. The ruling would ban the company, and its owner, James Krause, from being involved in any debt relief and/or student loan services programs ever again. Not only would this shut the company down, but it would require that they pay refunds to their customers, as well as a civil money penalty.
The CFPB first began this lawsuit against Student Loan Processing.USA in 2014 in federal district court in CA. The issue brought to court was that the company charged an outrageous upfront fee to customers before any services were offered after deceiving them of their costs. Student Loan Processing.US also claimed affiliation with the Department of Education, which they did not have.
If the lawsuit goes successfully, Student Loan Processing.US as well as James Krause are required to shut down the company and operations within 45 days. All contracts with past and present customers will be canceled, refunds will be made to customers, as well as ensure repayment benefits to the customers. Thereafter, James Krause and those who participated in Student Loan Processing.US must never participate in the debt relief and student loan industry again, and pay a civil penalty.