WASHINGTON, D.C. — The Federal Trade Commission (FTC) has put a stop to a scheme that deceived financially struggling consumers seeking student loan relief. The operators of the scam, who often targeted Spanish-speaking individuals in Puerto Rico, misled consumers into paying hundreds of dollars in junk fees. They pretended to be affiliated with the Department of Education and made false promises of low, fixed monthly payments and loan forgiveness.
A federal court has temporarily halted the scheme and frozen its assets at the FTC’s request. The FTC aims to end these unlawful practices and secure redress for the thousands of consumers who have been harmed.
“By pretending to be affiliated with the Department of Education and misrepresenting features of its free income-driven loan repayment programs, these scammers bilked millions from the consumers these programs were designed to help,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “We are pleased that the court preliminarily shut down this predatory operation and froze its assets, and we will continue our efforts to crack down on junk fees, unwanted calls, and exploitation of consumers struggling with student loan debt.”
Misleading Practices
According to the FTC’s complaint, since at least April 2019, Florida-based Start Connecting LLC and Colombia-based Start Connecting SAS, operating as USA Student Debt Relief (USASDR), enticed consumers with false claims of government affiliation. The operators, Douglas Goodman, Doris Gallon-Goodman, and Juan Rojas, promised to enroll consumers in programs guaranteeing low, fixed monthly payments—as low as $9 per month—and generous loan forgiveness. In exchange, they charged illegal advance fees of several hundred dollars, followed by monthly fees of up to $29.
USASDR falsely claimed that these payments would be applied to consumers’ loan balances. Instead, the operators pocketed the money and moved much of it offshore to Colombia.
Fake Testimonials
The complaint also highlights that USASDR used fake testimonials and reviews on its website and social media pages. They even posted fabricated reviews on third-party platforms like the Better Business Bureau and Trustpilot. One testimonial, posted on August 19, 2022, falsely claimed that USASDR reduced a consumer’s loan payments from $1,300 per month for 28 years to $417 per month for eight years. In reality, these reviews used stock photos and described payment scenarios that are unattainable under any legitimate income-driven repayment plan.
Telemarketing Tactics
USASDR’s telemarketers, based in Colombia, made over 750,000 outbound calls to consumers in the United States between April 2019 and February 2024. Nearly 30 percent of these calls targeted consumers in Puerto Rico, many of whom only spoke Spanish. The telemarketers also placed unwanted calls to consumers on the Do Not Call Registry.
The complaint notes that Spanish-speaking consumers were given contracts written in English, despite the sales pitches and email communications being in Spanish. This practice unfairly targeted consumers who do not speak or read English fluently.
Ongoing Investigation
The FTC continues to investigate and pursue actions against schemes that exploit consumers with student loan debt. The agency’s goal is to ensure that consumers are not misled by false promises and are protected from financial harm.
The FTC’s actions highlight the importance of verifying the legitimacy of student loan relief programs and being cautious of unsolicited offers. Consumers should be aware that legitimate income-driven repayment programs do not require advance fees and are directly managed by the Department of Education.
Protecting Consumers and Seeking Justice
The FTC’s intervention in halting this student loan relief scam is a significant step in protecting vulnerable consumers. By freezing the assets of the operators and seeking redress for those harmed, the FTC aims to prevent further exploitation. Consumers are encouraged to remain vigilant and report any suspicious offers to the FTC.
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