Illinois Attorney General Lisa Madigan is suing two companies Monday for allegedly scamming people with student loan debt.
“The scam for them is preying on financially susceptible individuals by claiming that they can eliminate or reduce your student loan debt. But as I said, what they really do is demand your credit card number, your bank account number, to immediately charge you as much as 12 hundred dollars.”
The lawsuits against Chicago-based First American Tax Defense and Texas-based Broadsword Student Advantage are the first in the nation against the scam.
Madigan says the companies charge hefty fees to enroll customers in federal debt-relief programs that either don’t actually exist or are free to join. Her office has heard dozens of consumer complaints.
Madigan says she expects to bring more lawsuits on the issue soon.