Monday, Attorney General Lisa Madigan filed lawsuits against two companies for "deceptive practices." The suits were filed in Champaign and Cook counties.
The companies claim to offer debt relief, but force consumers to fork over their credit card numbers. Madigan says students are often overwhelmed with student loan debt and turn to this type of fraud for help.
But, Madigan says, they're being charged up-front fees for phony services or for services which are free. Madigan says these companies are luring students with ads on radio, TV and online.
Illinois is one of the first states to attack such scams. Hopefully, this will protect more students.
The Federal Trade Commission is aware of the escalating problem. Debt settlement and collection companies are one of the biggest complaints called into the FTC last year. It got more than 200,00 complaints. That's up 10% in just two years.
First American Tax Defense, LLC, and Broadsword Student Advantage, LLC, are two of the companies Madigan is investigating.
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