CFPB Aims to Ban Student Loan Pro From Offering Financial Products

The Consumer Financial Protection Bureau (CFPB) has taken action to permanently ban Student Loan Pro and its owner, Judith Noh, from offering or providing consumer financial products, alleging that they violated federal law by requesting and receiving advance fees for debt-relief services.

The regulator filed a proposed stipulated judgment and order that, if entered by the court, would impose that ban; require Noh to dissolve both Student Loan Pro and FNZA Marketing; and pay a civil penalty of $2,000, the CFPB said in a Wednesday (Dec. 4) press release.

The civil penalty is limited by the defendants’ demonstrated ability to pay more, the release said.

The CFPB filed a lawsuit in 2021 alleging that Student Loan Pro, Noh and Syed Gilani — Student Loan Pro’s manager and owner-in-fact — violated the Telemarketing Sales Rule by charging borrowers upfront fees for debt relief services, according to the release.

The proposed stipulated judgment and order filed Wednesday would resolve CFPB’s claims against Student Loan Pro and Noh, but the regulator’s lawsuit against Gilani remains pending, per the release.

When announcing the filing of its lawsuit in March 2021, the CFPB said Student Loan Pros charged about 3,300 consumers over $3.5 million in advance fees.

“Student Loan Pro preyed on thousands of borrowers, charging illegal upfront fees in clear violation of the Telemarketing Sales Rule,” David Uejio, who was acting director of CFPB at the time, said in a press release. “The CFPB will use all the tools at its disposal, including litigation, to protect struggling borrowers and put an end to unlawful debt-relief schemes.”

In another, separate action, the CFPB said in August that it was seeking a $2 million civil penalty against Credit Repair Cloud CEO Daniel A. Rosen and a $1 million civil penalty against his company to resolve the regulator’s lawsuit alleging that they helped companies charge illegal advance fees to consumers.

In May, the regulator ordered Western Benefits Group to permanently cease operations and pay a $400,000 penalty after finding that the debt relief provider charged illegal advance fees and misled student loan borrowers.

In August 2023, the CFPB said it reached a proposed $2.7 billion settlement with credit repair brands Lexington Law and CreditRepair.com after a court ruling that the companies had collected illegal advance fees for credit repair services via telemarketing in violation of federal law.