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(ABC 6 News) – The Minnesota Attorney General’s Office is warning about fraudulent loan relief companies preying on student borrowers.
The warning comes after student loan repayments were suspended for three years.
Some fraudulent companies may charge consumers hundreds or even thousands of dollars in upfront fees, which is illegal in Minnesota. Others promise immediate student loan forgiveness or cancellation, which only the federal government has the power to do.
September 6th at the AG’s office. We have started an investigation into 52 Student loan debt relief companies may violate Minnesota law, and many are established in California.
Dec. 12 at Attorney General Keith Ellison’s office. announced Arrived settlement With one of those companies. In Ramsey County, the Alumni Support Center must immediately pay the state the full amount collected from Minnesotans, $179,067.10.
The AG’s office said it would use the funds to compensate affected consumers.
Evan Romanoff is an assistant attorney general in Minnesota who has worked on several cases involving fraudulent student debt relief companies. “They often misrepresent their fees. Consumers are often led to believe that the fees they are paying are going toward repaying their student loans, when in reality these fees are paid by companies out of their own pockets. We are just enriching ourselves.”
Red flags to look out for include requests for immediate attention, upfront fees, claims to work with the government, and not being registered with the U.S. Department of Commerce.
If you suspect that you have been defrauded by one of these companies or know that you have been defrauded, please contact the Minnesota Attorney General’s Office at (651)-296-3353 or toll-free at 1 Please contact us at -800-657-3787.
