FTC Obtains Restraining Order Against Student Loan Debt Relief Scam

FTC Halts Student Loan Debt Relief Scam Targeting Spanish-Speaking Consumers In July 2024, the Federal Trade Commission (FTC) announced it had stopped the operators of a scheme that tricked financially strapped consumers seeking student loan relief into paying hundreds of dollars in junk fees. The operators often targeted Spanish-speaking consumers in Puerto Rico, pretended to be affiliated with the Department of Education and its loan servicers, and made false promises of low, permanently fixed monthly payments and loan forgiveness. A federal court temporarily halted the scheme and froze its assets at the request of the FTC. In May 2025, the FTC announced that the operators of the scam had agreed to be permanently banned from the debt relief industry and to turn over their assets to resolve allegations that they misled consumers. The case involves Start Connecting LLC, a Florida limited liability company doing business as USA Student Debt Relief, and Start Connecting SAS, a Colombia corporation too doing business as USA Student Debt Relief. The individuals named as defendants include Douglas R. Goodman, Doris E. Gallon-Goodman, and Juan S. Rojas, who were officers of the respective companies. The FTC alleged violations of the Federal Trade Commission Act, the Telemarketing Sales Rule, the Gramm-Leach-Bliley Act, and the FTC’s new Impersonation Rule. The Commission alleged that the defendants, operating through multiple companies, targeted borrowers following the end of the federal student loan payment pause, misrepresented affiliations with the Department of Education, and collected hundreds of dollars in illegal upfront fees while providing little or no relief. Specifically, the complaint alleges that the company: – Pretended government affiliation by sending mailers and making telemarketing calls that misled borrowers into believing they were working with the Department of Education or its loan servicers – Collected unlawful upfront fees, with borrowers allegedly charged up to $899 in initial costs and recurring $49 monthly payments for as long as 20 years – Engaged in deceptive practices that amounted to unfair or deceptive acts or practices, reinforcing the FTC’s core UDAP authority under the FTC Act The proposed order to settle these charges prohibits the defendants from: – Misrepresenting affiliations with any entity – Falsely promising enrollment in programs with guaranteed low payments or loan forgiveness – Charging illegal advance fees – Using fake testimonials and reviews online – Engaging in unlawful telemarketing or misrepresenting other products or services The FTC emphasized that it is illegal for debt relief companies to craft false promises and use fake reviews and testimonials to promote a business, stating that the agency will not hesitate to enforce the law against disappointing actors.