More than forty-two million Americans have student loans with an outstanding balance of more than 1.4 trillion dollars so it is no surprise that scammers are focusing their attention on these students and former students through scams that falsely promise to provide debt relief. I have written numerous times in the past about various student loan debt relief scams. Recently the Consumer Financial Protection Bureau (CFPB) took legal action against Western Benefits Group for illegally charging advance fees for student loan debt relief services and misrepresenting to consumers that these fees would be used to pay down their loans as well as falsely stating that it was endorsed by the Department of Education.

As a result of the actions of the CFPB, Western Benefits is permanently shut down and must pay a $400,000 fine that will be used to compensate its victims.  I will notify you when these funds are to be distributed.

TIPS

The old adage still is true.  If it sounds too good to be true, it probably isn’t true.  Many of these student loan debt relief scammers promise quick loan forgiveness, which is unrealistic.  In addition, you should never pay any upfront fees for student loan debt relief assistance.  Those fees are illegal and are a sure indication that you are being scammed.  Also, remember my motto, “trust me, you can’t trust anyone.”  Don’t trust scammers merely because they use names that sound like they are affiliated with the government.  You also should never share your FSA ID with anyone.

For information you can trust about federal student loan repayment option, go to https://studentaid.gov/manage-loans/repayment/plans.  There you can learn about loan deferments, forbearance, repayment and loan forgiveness programs and there is never an application fee.  If you owe private student loans, contact your loan servicer directly.  You can also look into student loan refinancing rather than consolidating the loans.  Refinancing student loans can result in a lower interest rate.  For more information about student loans go to https://www.consumer.ftc.gov/articles/1028-student-loans

If you are not a subscriber to Scamicide.com and would like to receive daily emails with the Scam of the day, all you need to do is to go to the bottom of the initial page of http://www.scamicide.com and type your email address on the tab that states “Sign up for this blog.”