The Federal Trade Commission has stopped scammers who the agency says facilitated an operation to prey on students seeking debt relief. The agency charges that the defendants pretended to be affiliated with the U.S. Department of Education, used deceptive loan forgiveness promises, and falsely claimed they were offering relief under the “Biden Loan Forgiveness” plan to lure students and collect millions in illegal upfront fees.
“During a period of uncertainty for borrowers saddled with student loan debt, these defendants bilked consumers out of millions of dollars with junk fees and phony promises of loan forgiveness and lower monthly payments,” said Samuel Levine, Director of FTC’s Bureau of Consumer Protection. “We are pleased that the court shut down this operation and froze its assets, and we will continue the agency’s ongoing efforts to pursue scammers that target the tens of millions of Americans with student loan debt.”
According to the complaint, since at least 2019, California-based companies Express Enrollment LLC (also doing business as SLFD Processing) and Intercontinental Solutions LLC (also doing business as Apex Doc Processing LLC), operated by Marco Manzi, Ivan Esquivel, and Robert Kissinger, have targeted students seeking debt relief and collected approximately $8.8 million in illegal advance fees in exchange for student loan debt relief services that did not exist.
The FTC charges that the defendants falsely promised to lower or eliminate students’ loan payments, pretended to be affiliated with the U.S. Department of Education, and convinced students to stop communicating with their federal loan servicers. The defendants have told consumers that they must pay a fee for services that are available for free through the U.S. Department of Education, including that consumers must pay a fee, or make purported loan payments, to obtain federal student loan forgiveness under the “Biden Loan Forgiveness” or some similar name (which consumers have understood to refer to the Biden-Harris Administration’s Student Loan Debt Relief Plan). For example, one consumer was told that “because I received a Pell Grant, my student loans would be forgiven up to $20,000, if I paid a processing fee of $375.” Another consumer was told that “under ‘the student loan forgiveness program’: (1) my student loan balance would be reduced by $10,000 and (2) I would begin a new loan repayment plan starting with six monthly payments of $250[.]”
The complaint also notes that the defendants used these misrepresentations to illegally obtain consumers’ bank account, debit card, or credit card information, and typically collect hundreds of dollars in unlawful advance fees—sometimes through remotely created checks in violation of the Telemarketing Sales Rule (TSR).
The FTC charges that the defendants have violated Section 5 of the FTC Act, the TSR, and the Gramm-Leach-Bliley Act.
After the FTC filed a complaint seeking to end the deceptive practices, a federal court temporarily halted the operations and froze the assets of Apex Processing Center and its owners.
The Commission vote authorizing the staff to file the complaint was 3-0. The U.S. District Court for the Central District of California entered a temporary restraining order on August 16, 2023.
NOTE: The Commission files a complaint when it has “reason to believe” that the named defendants are violating or are about to violate the law and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court.
The lead staff attorney for this matter is Carlton Mosley of the FTC’s Bureau of Consumer Protection.