A Florida federal district court has entered a preliminary injunction against several companies and an individual who were named as defendants in a complaint filed by the CFPB in August 2015 charging them with violations of the Consumer Financial Protection Act (CFPA) and Telemarketing Sales Rule (TSR).
The complaint alleges that the defendants operated debt relief businesses that charged advance fees in violation of the TSR. According to the complaint, in anticipation of the TSR’s ban on advance fees which became effective in 2010, the defendants developed a plan to avoid the ban by “continuing operations under the guise of providing legal services” and began promising consumers both debt relief services and legal representation, including through a local attorney. The complaint alleges that the defendants engaged in deceptive acts and practices in violation of the CFPA because consumers did not receive legal representation as promised by the defendants.
The preliminary injunction entered on September 2, 2015 includes an asset freeze, appointment of a receiver, and disablement of the defendants’ websites.