The CFPB has announced that it has entered into a proposed consent order with Premier Consulting Group LLC and a related law firm to settle claims that the defendants charged consumers upfront fees in violation of the Telemarketing Sales Rule (TSR). The consent order requires the defendants to pay a civil penalty of $69,075 which, according to the CFPB, represents the amount of advance fees the defendants took from consumers who did not have any debts settled. It also enjoins the defendants from engaging in future TSR violations and requires them to submit a compliance plan to the CFPB to ensure that any debt relief services they provide in the future comply with the TSR and all other applicable federal consumer financial laws.
The consent order does not provide for restitution. In its press release, the CFPB states
“[c]onsumers who were harmed by these violations may be eligible for relief from the CFPB’s Civil Penalty Fund in the future.” Perhaps this suggests that the defendants did not have the financial capability to also make restitution. However, under those circumstances, it seems that a better result for consumers would have been for the CFPB to have ordered payment of restitution and omitted a civil penalty.
The CFPB had filed a complaint against the defendants in May 2013 in a New York federal district court. The CFPB’s complaint also named as defendants another debt-settlement service provider, Mission Settlement Agency, and its principal, who were alleged to have engaged in similar unlawful conduct. Contemporaneously with the filing of the CFPB’s civil lawsuit, Mission and its principal became the subjects of the CFPB’s first criminal referral. Last month, Mission’s principal was sentenced to nine years in prison after pleading guilty to several charges and ordered to pay $2.1 million in restitution and a fine of $15,000. The company was ordered to pay a fine of $4.393 million and $2.196 million in restitution.