Attorney General Ellison shuts down two more deceptive student-loan debt-relief companies in Minnesota

The two companies will pay State $56K to refund customers who fell victim to their fraudulent forgiveness schemes

The Minnesota Attorney General’s Office has returned over $1.8 million total to consumers victimized by fraudulent student-loan debt-relief companies

December 21, 2023 (SAINT PAUL) — Minnesota Attorney General Keith Ellison announced today that his office has obtained two more settlements with student loan debt relief companies that illegally collected fees from customers and misrepresented their services. The settlements require both companies to refund all payments from Minnesota customers and cease operating in the state.

The first settlement is with Start Connecting LLC, d/b/a USA Student Debt Relief, which will refund a total of $41,490.91 to Minnesota consumers. The second settlement is with Global Business Group, d/b/a Allied Financial Services, which will be paying back $14,308.42 to Minnesota consumers. Both companies were part of the 52 student loan debt relief company that Attorney General Ellison’s Office announced it is investigating for suspected violations of Minnesota law on September 6, 2023.

The Attorney General alleges that both USA Student Debt Relief and Allied Financial Services collected illegal up-front fees to enroll consumers in federal repayment programs that consumers can enroll themselves in for free. Both companies also charged these fees before performing the promised services, which is illegal under Minnesota law regulating debt settlement services. Additionally, both companies were operating without registering as a debt-settlement service provider, as required by Minnesota law. Attorney General Ellison’s Office alleges in the settlements that both companies violated Minnesota’s Debt Services Settlement Act, Prevention of Consumer Fraud Act, and Uniform Deceptive Trade Practices Act.

The settlements require both USA Student Debt Relief and Allied Financial Services to immediately pay back the full amount they collected from Minnesota customers to provide full restitution to those customers.

“Minnesotans struggling with their student loans deserve our empathy and support, not to have their struggles exploited by predatory companies,” said Attorney General Ellison. “I am glad our settlements with these companies will return money to the pockets of folks who are just trying to afford their lives. My office will continue to hold these shady companies accountable for breaking the law and taking advantage of Minnesotans.”

Student-loan debt-relief companies often charge consumers hundreds or thousands of dollars of illegal upfront fees to enroll them in repayment plans or consolidation loans—which are sometimes unnecessary or inappropriate for the consumers—that all eligible federal student-loan borrowers can apply for on their own for free through the United States Department of Education. Often, these companies deceive consumers into believing that the fees will go toward paying down the consumers’ student-loan debt, when the companies actually pocket the fees.

This settlement marks the 17th and 18th time the Minnesota Attorney General’s office has shut down a fraudulent student-loan debt- relief company in Minnesota, following others in April 2016, July 2016, October 2016, February 2018, September 2019, October 2019, April 2020, September 2020, January 2021, April 2021, October 2022, November 2022, February 2023, October 2023, November 2023, and December 2023. In total, the Minnesota Attorney General’s Office has recovered over $1.8 million to return to Minnesota consumers victimized by fraudulent student loan debt settlement companies.

Attorney General Ellison encourages anyone who has been victimized by Alumni Support Center to contact the Minnesota Attorney General’s Office by calling (651) 296-3353 (Metro area) or (800) 657-3787 (Greater Minnesota), or by submitting a complaint form on the Attorney General’s website at www.ag.state.mn.us/Office/Complaint.asp.

The Attorney General’s Office encourages borrowers to visit its website for additional information on how to avoid student-loan scams, including a publication entitled Student Loan Assistance Companies that Charge High Fees for What You Can Do for Free. Student-loan borrowers may access the United States Department of Education’s website — https://studentaid.gov/manage- loans/repayment/plans — for additional information about federal student-loan repayment programs available to all eligible borrowers for free.