WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB) today filed a complaint in a federal district court in New York against two debt-relief service providers that allegedly charged consumers illegal advance fees for debt-settlement services. The Bureau is seeking to halt the operations and to obtain both penalties and relief for victims.
“Today’s action takes aim at two operations we believe are designed to profit through unscrupulous and illegal business practices,” said CFPB Director Richard Cordray. “Consumers deserve better and we are proud of this coordinated effort with the Department of Justice and U.S. Attorney Preet Bharara to crack down on harmful behavior.”
According to the CFPB complaint, the defendants, Mission Settlement Agency (Mission) and related entities and individuals, and Premier Consultant Group LLC (Premier) along with a related entity, routinely charged consumers upfront fees prior to settling the consumers’ debts. These illegal fees and the companies’ failures to provide effective services often caused consumers to fall further into debt and harm their credit history in the process. Mission is based in New York and Premier is based in New Jersey.
The Bureau alleges that all of the defendants violated the Federal Trade Commission’s Telemarketing Sales Rule (TSR). In addition, the Bureau alleges that Mission and its principal, Michael Levitis, engaged in deceptive and unfair practices in violation of the Dodd-Frank Wall Street Reform and Consumer Protection Act. In total, defendants allegedly charged fees to over a thousand consumers in multiple states in violation of the TSR’s advance fee ban, totaling over $1.3 million.
The CFPB initiated this investigation in July 2012, and later referred evidence of criminal conduct to the United States Attorney for the Southern District of New York. The CFPB is required by the Dodd-Frank Act to refer evidence of criminal activity to the Department of Justice. In connection with these actions, the CFPB has also received substantial assistance from the New York Office of the U.S. Postal Inspection Service.
This action is part of the CFPB’s comprehensive effort to prevent consumer harm in the debt-relief industry. The Bureau is working to ensure federal consumer laws are being followed at every stage of the process and is focusing not only on debt-relief service providers, but also on those who facilitate their unlawful conduct and who may also violate federal consumer financial laws.