CFPB Distributes Over $4.7 Million to Consumers Impacted by Financial Aid Scam
By Maria Carrasco, NASFAA Staff Reporter
The Consumer Financial Protection Bureau (CFPB) announced on Friday that it is distributing over $4.7 million to consumers impacted by a financial aid scam from the College Financial Advisory and Student Financial Resource Center.
In 2015, the CFPB filed a complaint in federal court against the Student Financial Resource Center and College Financial Advisory, which are under the same corporation named Global Financial Support, Inc. CFPB claimed the two organizations illegally charged millions of dollars in fees for “sham financial services.”
“Student Financial Resource Center and College Financial Advisory scammed thousands of students by masquerading as government agencies and other trusted organizations,” said Richard Cordray, former CFPB director and current chief operating officer of Federal Student Aid, in 2015. “Students and families were looking for information on how to pay for college, instead they were illegally charged millions of dollars for sham financial services. We will continue to take strong action against those who deceive consumers.”
In its complaint, CFPB noted that the College Financial Advisory and Student Financial Resource Center tricked consumers into thinking they are applying for financial aid services, falsely represented an affiliation with the government or academic institutions, and pressured consumers with threats of losing financial aid opportunities.
CFPB stated that if a consumer paid for information or financial aid services from College Financial Advisory or Student Financial Resource Center, they may receive a check in the mail. Payments were sent on March 31, 2023. The total distribution amount is over $4.7 million and impacts over 78,000 consumers.
Publication Date: 4/3/2023
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