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Special notice for Corinthian students

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Today, we announced a lawsuit against for-profit college chain Corinthian Colleges, Inc. We allege that the company lured in tens of thousands of students to take out private loans to cover expensive tuition costs by advertising bogus job prospects and career services. Our lawsuit also alleges that Corinthian used illegal debt collection tactics to strong-arm students into paying back those loans while still in school.

Corinthian Colleges, Inc. is one of the largest for-profit college companies in the United States, operating more than 100 school campuses under the names Everest, Heald, and WyoTech.

Today, we’re also publishing a special notice for current and former Corinthian students to help you navigate your options in this time of uncertainty, including information on loan discharge options.

If you experience difficulty with your student loan you can submit a complaint online or by calling (855) 411-2372. You can also find more information about options for repaying your student loan on our website.

El administrador de negociación del National City Bank pronto se pondrá en contacto con los prestatarios elegibles

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El año pasado, presentamos, junto con el Departamento de Justicia, una queja contra el National City Bank (National City) por discriminación en los precios de los préstamos hipotecarios. La queja alegaba que el National City había cobrado a los prestatarios afroamericanos e hispanos precios más altos por sus préstamos hipotecarios que a los prestatarios blancos con capacidad crediticia similar entre 2002 y 2008. Un tribunal federal ordenó al PNC Bank, que compró al National City en 2009, proporcionar $35 millones en alivio a los prestatarios minoritarios que pagaron en exceso.

El Administrador del Mandato Consentido del National City localizará y enviará cheques a los prestatarios minoritarios que recibieron cargos en exceso. Durante las próximas dos semanas, el Administrador enviará paquetes de información a todos los prestatarios elegibles invitándoles a participar en el arreglo legal. Si usted fue sometido a cargos excesivos y es elegible, usted recibirá un paquete informativo diciéndole específicamente qué cantidad de dinero recibirá por mínimo. La cantidad real de su pago puede ser mayor, según el número de prestatarios que aceptan participar en el arreglo legal.

Envíe su formulario

Los paquetes enviados incluirán un formulario que usted debe firmar si desea recibir su pago. Puede devolver este formulario de participación por correo con franqueo prepago, por correo electrónico o por fax. Simplemente siga las instrucciones del formulario. No olvide enviar su formulario a más tardar el 21 de octubre de 2014. Sólo los consumidores elegibles que devuelven sus formularios a más tardar el 21 de octubre de 2014 recibirán pagos.

Si usted no recibe un paquete informativo por correo antes del 30 de septiembre, y cree que debería recibir un pago, llame al Administrador del Mandato de Consentido de National City al (866) 523-6751 para preguntar sobre su elegibilidad. También puede llenar un formulario de elegibilidad para reclamación y enviarlo por correo, correo electrónico o fax.

La participación en el arreglo legal es gratuita

Manténgase en alerta de estafadores alegando que le ayudarán por una comisión o pidiendo información personal con el fin de obtener su cheque. Cuando un gran número de consumidores recibe dinero de un arreglo legal es cuando a veces aparecen los estafadores. El estafador puede tratar de cobrarle una cuota o de robar su información personal. Si bien usted está en libertad de hablar con un abogado, no necesita contratar a un abogado ni pagarle a nadie para poder participar en este arreglo legal.

Como parte de este arreglo legal, el Administrador del Mandato Consentido del National City, la Oficina para la Protección Financiera del Consumidor, el Departamento de Justicia o su oficina del Fiscal de EE. UU. local podrían ponerse en contacto con usted. Cualquier otro intento de contacto que afirme estar relacionado con este arreglo legal debe ser tratado como una estafa. Por favor, informe de inmediato cualquier estafa al Administrador del Mandato Consentido del National City llamando al (866) 523-6751 o por correo electrónico al: info@NationalCityConsentOrder.com.

¿Tiene más preguntas?

Si tiene preguntas, consulte el sitio web del Administrador del Mandato Consentido del National City o llame al (866) 523-6751.

Obtenga más información sobre cómo puede protegerse de la discriminación crediticia.

Closing the book on Colfax

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Today, we announce an enforcement action against Colfax Capital Corporation and its subsidiary Culver Capital, LLC for engaging in unlawful lending practices that targeted and financially harmed servicemembers.

Although the name Colfax Capital Corporation might be new to some, this is actually the last gasp of a chameleon-like company with a long and deplorable record of preying on servicemembers.

Formerly known as Rome Finance Co. Inc. and Rome Finance Company, LLC (collectively Rome Finance), this unlicensed lender provided financing that merchants, such as SmartBuy, used when selling products to military members. Rome Finance’s contracts inflated the disclosed prices of the products to hide the true finance charges that the servicemembers would have to pay, typically by military allotment. This trapped servicemembers in contracts that generated millions of dollars for the company and substantial debt for its customers.

Background on the company’s actions

Rome Finance first came to our attention on Veterans Day 2010, when SmartBuy, Rome Finance and other affiliated finance companies operating in New York were sued by NY Attorney General Eric Schneiderman for unlawful practices that targeted soldiers at Fort Drum. A subsequent review of complaints submitted to the Federal Trade Commission’s Consumer Sentinel Network, our consumer complaints, and an investigation by AG Schneiderman’s office revealed that military members were also targeted in California, Tennessee, Colorado, Georgia, North Carolina, Oklahoma, Texas, and even overseas. The NY suit led to approximately $13 million dollars in fines and settlements.

The NY suit was actually not the first time Rome Finance had been called to account for its unlawful practices. Tennessee Attorney General Robert Cooper had brought suit in 2005 against Rome Finance and an affiliated company called Britlee Inc. for unlawful practices that targeted servicemembers near Fort Campbell Army post through their The Military Zone and Laptoyz Computers and Electronics stores. The TN lawsuit also resulted in a multi-million-dollar judgment against Rome Finance and its network of companies.

What it means for impacted consumers

Although Rome Finance was able to continue doing business for some time by filing for bankruptcy, changing its name to Colfax Capital Corp. and Culver Capital, LLC and employing other evasive maneuvers, I am happy to see that we can finally close the book on Rome Finance in all its forms, and see that they never receive another penny from servicemembers.

Since the company is being liquidated in bankruptcy, Colfax does not have enough money or assets to pay back consumers affected by its actions. Instead, consumers will no longer have to pay on the more than 17,000 outstanding finance agreements, amounting to a total of about $92 million in debt relief for consumers. If you have outstanding finance agreements with Colfax should stop making payments immediately and turn off any allotments that were set up to make these payments. The Bankruptcy Trustee will also notify the credit reporting bureaus that consumers’ contracts with the company should be treated as “paid as agreed,” which could potentially help consumers’ credit scores. Also, if you had default judgments against you, you can apply for the judgments to be vacated. If you have questions about how to do this, check with your JAG or the Attorney General’s office in your state.

Defend yourself from deceptive practices

The sad truth is that Rome Finance was not the first and will not be the last company to financially prey on the military community. Servicemembers, veterans and military families need to actively guard themselves against bad business practices and financial scams.

Make sure you know the total price of the product you’re buying, including interest and fees for your loan, not just the monthly payment! Use available resources like your installation Personal Financial Manager, JAG or legal aid office, your state’s Attorney General office, the Better Business Bureau, and even the internet to research the contract terms and company. Demand to take a copy of the sales contract to a financial or legal professional for review before you enter into it. And if the company will only take payments by military allotment, ask why. That could be a red flag.

Federal and state officials worked in this case to protect you, but remember that you are your own most important first line of defense when it comes to consumer financial decisions!

Claim forms for the Ocwen settlement available now

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Last year, along with authorities from 49 states and the District of Columbia, we filed an order requiring Ocwen Financial Corporation and Ocwen Loan Servicing to provide $125 million to foreclosure victims.

The National Ocwen Settlement Administrator is responsible for handling settlement claims and has created a website with information for consumers who were harmed by Ocwen’s actions.

Submit your claim online or by mail

The National Ocwen Settlement Administrator has contacted foreclosed borrowers and mailed notice packages last week. Once the materials arrive, you can submit your claim online. You’ll need your personalized claimant ID number (located on the form you receive in the mail) to complete your submission. Be sure to submit the online claim form by September 15, 2014.

If you choose to submit your claim form by mail, follow the instructions in the materials you receive in the mail from the National Ocwen Settlement Administrator. Claim forms submitted by mail must be postmarked by September 15, 2014.

You won’t receive a settlement if you don’t file your claim. All eligible borrowers who submit valid claims will receive an equal share of the $125 million. If you receive payments, you will not have to release any claims and will be free to seek additional relief in the courts.

Filing a claim is free

Watch out for scammers claiming that they will help you with your claim. When large numbers of consumers get refunds, scammers sometimes pop up. The scammer may charge you a fee or try to steal your personal information. If someone tries to charge you, tries to get you to disclose your personal information, or asks you to cash a check and send a portion to a third party in order to “claim your refund,” it’s a scam. Call us at (855) 411-2372.

Still have questions?

If you have questions about your claim, eligibility, or the settlement, check out the commonly asked questions or call the National Ocwen Settlement Administrator at (866) 783-5382, Monday through Friday, 7 a.m. – 7 p.m. CT.

Explainer: Compensating consumers for Bank of America’s illegal tactics for credit card add-on products

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Today we’re fining Bank of America, N.A. and FIA Card Services, N.A. for unfairly billing consumers for services relating to identity theft protection “add-on” products and for using deceptive marketing and sales practices for credit protection “add-on” products.

We are also ordering Bank of America to refund fees and provide other redress to consumers. Approximately 2.9 million consumers will be receiving or already have received up to $727 million in refunds for fees they paid for these products and services as well as additional redress.

If you’re impacted by the announcement, you don’t have to take any action to receive a credit or check. If you are one of the consumers affected by the order, Bank of America should have already notified you or will notify you directly. If you have questions about whether you are entitled to a refund, you can contact Bank of America.

Who is eligible for compensation?

Nearly 1.4 million consumers have already received or will receive refunds of at least $250 million in fees for the “credit protection” products (Credit Protection Plus and Credit Protection Deluxe). You will receive refunds if you are a Bank of America customer who enrolled in these products at any time over the phone, were charged a fee between October 1, 2010 and March 31, 2013, and either did not activate benefits or who had  a request for benefits denied.

Approximately 1.5 million consumers purchased the “identity theft protection” products (Privacy Guard, PrivacySource, and Privacy Assist) and were improperly billed for services that were not performed. As a result, consumers paid at least $459 million in fees, interest, and over-limit charges for these products without receiving full services. Today’s announcement recognizes the refunds Bank of America has already provided to consumers harmed as a result of the illegal billing practices relating to these identity theft protection products.

Eligible consumers who were enrolled in the “identity theft protection” products received refunds if they enrolled in these products between October 2000 and September 2011 but did not receive full credit monitoring services, received only partial credit monitoring and/or credit report retrieval without notice, and/or didn’t receive credit report retrieval benefits.

What do eligible consumers get?

That depends on the product consumers were enrolled in and some other factors.

Eligible consumers who were enrolled in a “credit protection” product for less than a year, who made a request for benefits that was denied or closed, or who, complained to the CFPB or to Bank of America stating that they did not authorize enrollment in the product, will receive a refund of all fees charged from October 1, 2010 through March 31, 2013. Eligible consumers who were enrolled in a “credit protection” product for a year or more and who do not fall within any of the groups described above will receive a refund of 300 days of fees charged from October 1, 2010 through March 31, 2013.

Some consumers who were enrolled in “credit protection” product will also receive:

  1. A reduction in charged-off balances due to product fees charged from October 1, 2010 through March 31, 2013.
  2. “Credit protection” services for six months at no-cost for consumers enrolled in the product as of March 1, 2013.

Bank of America has already completed reimbursement for the “identity theft protection” eligible consumers, so eligible consumers should have already received refunds. If you have questions about receiving a refund for this product, you can contact Bank of America.

Bank of America is responsible for providing refunds

Watch out for scammers claiming they will get you a refund. When large numbers of consumers get refunds, scammers sometimes pop up. The scammer may charge you a fee or try to steal your personal information. If someone tries to charge you, tries to get you to disclose your personal information, or asks you to cash a check and send a portion to a third party in order to “claim your refund,” it’s a scam. Please call us at (855) 411-CFPB to report the scam.

We’re protecting students from predatory lending

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Today, we filed a lawsuit against ITT Educational Services, Inc., accusing the for-profit college chain of predatory student lending. We believe that ITT used high-pressure tactics to push many students into expensive private student loans that were likely to end in default.

This is our first public enforcement action against a company in the for-profit college industry.

“Today’s action should serve as a warning to the for-profit college industry that we will be vigilant about protecting students against predatory lending tactics,” said Director Richard Cordray.

You can read the press release, read Director Cordray’s full remarks, and view the formal complaint against ITT.

You can also watch a recording of today’s press conference.