Statement Regarding CFPB Settlement with Nation’s Largest Debt Relief Company


National Consumer Law Center contacts: Andrew Pizor ( or Jan Kruse (

Washington, D.C. – Today, the Consumer Financial Protection Bureau (CFPB) announced the settlement of a lawsuit it had brought against Freedom Debt Relief, the nation’s largest debt settlement company. According to the CFPB, the company agreed to pay $20 million in restitution to affected consumers and a $5 million civil money penalty.  The original suit was filed in November 2017 and an amended complaint filed in June 2018.

The following is a statement by National Consumer Law Center attorney Andrew Pizor.

“I applaud the Consumer Protection Financial Bureau for taking action against Freedom Debt Relief. It is especially important that the settlement included restitution for aggrieved consumers. Debt settlement and similar programs offered by companies like Freedom often do more harm than good and turn out to be a waste of money. Consumers should talk to their creditors directly and do their own debt settlement negotiations, or they should talk to a qualified consumer bankruptcy attorney.”

Related Links

NCLC Issue Brief: Need Help with Debts? Don’t Get Burned by Scammers: Spanish version:

NCLC general information on debt relief services:

National Association of Consumer Bankruptcy Attorneys:

Consumer, Civil Rights Advocates to CFPB: Don’t Water Down Overdraft Fee “Opt In” Rule 


National Consumer Law Center: Jan Kruse ( or (617) 542-8010
Center for Responsible Lending: Ricardo Quinto (

“More, not less, comprehensive reform of unfair and abusive overdraft fee practices is badly needed.” 

“Overdraft fees are unfair, deceptive, harmful, and outrageously high—and they hit consumers of color the hardest”

WASHINGTON, D.C. – The Center for Responsible Lending (CRL), National Consumer Law Center (on behalf of its low-income clients), Americans for Financial Reform Education Fund, National Association for the Advancement of Colored People (NAACP), National Coalition for Asian Pacific American Community Development (National CAPACD), and National Fair Housing Alliance (NFHA) late yesterday submitted a letter to Consumer Financial Protection Bureau (CFPB) Director Kathy Kraninger urging her not to weaken the Federal Reserve Board’s 2009 overdraft “opt in” rule.

Under the Rule, which went into effect in 2010, financial institutions must not assess a fee or charge on a consumer’s account for paying an ATM or one-time debit card overdraft transaction, unless the institution, among other things, obtains the consumer’s affirmative consent, or opt-in, to the institution’s payment of overdrafts for these transactions. Previously, some banks had automatically enrolled borrowers in overdraft coverage for these transactions without their knowledge and it became clear that many borrowers did not want the high-cost fees that came with the practice. The CFPB became responsible for this rule in 2011 and is now reviewing it under the Regulatory Flexibility Act (RFA).

In their letter, the advocates wrote: “The considerations prescribed by the RFA strongly support strengthening protections against overdraft fees on debit card and ATM transactions. More broadly, comprehensive reform of unfair and abusive overdraft practices is badly needed. … Financial institutions combine a number of unfair and abusive practices in order to impose high, repeat overdraft fees on their customers. These fees create hardships from which many consumers do not recover. Comprehensive, sound regulatory policy around overdraft fees—rules that prohibit unfair and abusive practices in overdraft programs—can restore health to the market, make space for far better products, and save families from being washed away by the very institutions that hold themselves out as vehicles for those families’ financial security.”

Prior to Director Kraninger’s call to review the overdraft “opt-in” rule, her leadership team announced last year that it will halt its overall rulemaking plan to address bank overdraft fee abuses. The CFPB had studied overdraft fees since 2012 and the results have underscored that overdraft programs use unfair and abusive practices to exploit financially vulnerable customers. Research has also shown that bank overdraft programs disproportionately harm lower income communities and communities of color. Bank overdraft practices drive many low-income people out of the banking system altogether.

In their letter to Director Kraninger, the advocates also urged her to have the CFPB take a comprehensive approach to further address overdraft fee abuses. “We urge CFPB to subject overdrafts on all transactions to credit protections, including permitting repayment in affordable installments. This is particularly warranted for overdraft fees that exceed those that may be occasional and inadvertent—fees exceeding more than one per month and six per year,” the advocates said.

A larger coalition of more than 20 organizations also sent a letter to Director Kraninger stressing that the agency shouldn’t water down the current rule.

In 2018, CRL released Unfair Market: The State of High-Cost Overdraft Practices in 2017, a report analyzing the overdraft fee revenue generated by banks and the overdraft practices of the 10 largest banks across the United States. According to Federal Deposit Insurance Corporation (FDIC) data, banks with over $1 billion in assets collected more than $11.45 billion in overdraft and non-sufficient funds (NSF) in 2017.

In 2017, before Mick Mulvaney and Kraninger took control of the bureau, the CFPB released a study that exposed the extent to which large banks’ abusive overdraft fees drain working families’ checking accounts. The study found that nearly 80% of bank overdraft and NSF fees are borne by only 8% of account holders, who incur ten or more fees per year, with many of those customers paying far more. For one group of hard hit consumers, the median number of overdraft fees was 37, nearly $1,300 annually. The study also confirmed that overdraft fees on debit cards can lead to extremely high cumulative fees for consumers.

Financial institutions typically charge an overdraft fee when a customer’s account lacks sufficient funds to cover a transaction, but the institution chooses to pay the transaction anyway. Overdraft fees can be triggered by debit card transactions, ATM withdrawals, electronic bill payments, and paper checks. Some institutions do not charge overdraft fees on debit card or ATM withdrawals—simply declining the transaction at no cost when the account lacks sufficient funds—but many banks do. The bank typically charges a fee for each individual overdraft transaction it pays, even when the customer overdrafts by a small amount. The institution repays itself for the overdrawn transaction, as well as the high fees(s), directly from the customer’s next deposit, in effect “jumping the line” ahead of any other planned transactions or debts the consumer has.

Will Student Loan Borrowers in Income-Driven Repayment Get the Loan Forgiveness They’ve Been Promised? 


National Consumer Law Center contacts: Persis Yu ( or Jan Kruse (; (617) 542-8010

National Consumer Law Center Files FOIA to Find out on 25th Anniversary of Borrowers Participating in Income-Driven Repayment Plans

Download NCLC’s FOIA request at:

Boston — On July 1, 1994, the U.S. Education Department launched its first Income-Driven Repayment Plan, designed to allow student loan borrowers to keep their payments affordable and to forgive any remaining balance after 25 years of payments.  But is this promise being fulfilled?  Today—on the 25th anniversary of the creation of this program–the National Consumer Law Center (NCLC) has submitted a Freedom of Information (FOIA) Request to the U.S. Department of Education (Department) to determine whether federal student loan borrowers will receive the forgiveness to which they should be entitled.

Income-driven repayment (IDR) options help borrowers keep their student loan payments affordable with payment caps based on their income and family size. Any debt that remains after 20 or 25 years of payments based upon the plan will be forgiven. “Income-driven repayment is a critical option for student loan borrowers struggling to keep current on their federal student loan payments,” said Persis Yu, National Consumer Law Center attorney and director of its Student Loan Borrower Assistance Project. “Forgiveness is the critical light at the end of the tunnel for these borrowers.”

The first cohort of borrowers who entered the Income-Contingent Repayment (ICR), the first IDR plan in 1994, and remained in the original ICR plan, should be eligible for forgiveness starting this month.

“Unfortunately, too many borrowers do not receive the benefit of income-driven repayment because of unnecessary bureaucratic hurdles and abusive servicing practices, and lack of knowledge that the program exists,” said Yu.

As documented by Consumer Financial Protection Bureau, problems with the U.S. Department of Education’s implementation of income-driven repayment plans are widespread. For example, borrowers in an IDR plan must renew their eligibility every year, but many borrowers experience problems with the renewal process. Additionally, too often, borrowers are steered into costly forbearances even when income-driven repayment is a better option. It was these types of problems that led to several lawsuits against student loan servicer Navient by the CFPB and several Attorneys General for practices that caused borrowers to pay thousands of additional dollars on their federal student loans and added years to their repayment.

“Forgiveness under an Income-Driven Repayment plan is supposed to be automatic,” said Yu.  “But we know from the horrendous denial rates that servicing problems are causing borrowers to be denied access to forgiveness under the Public Service Loan Forgiveness program, another Education Department program that was supposed to be automatic. We are very worried that eligible borrowers participating in IDR plans will have the same or worse problems.   We are requesting data from the Department that will illuminate the scope of these problems.”

Related NCLC Resources

NCLC’s FOIA request to the U.S. Department of Education, July 1, 2019

Student Loan Forgiveness Cannot Work Without a Right to a Payment History, May 23, 2019

National Consumer Law Center Sues U.S. Education Department to Obtain Copy of Student Loan Servicing Contract, April 18, 2019

96 Out of 28,000 Borrowers Approved for Public Service Loan Forgiveness … What Does This Mean for Everyone Else?, Oct. 5, 2018

Comments to CFPB on Proposal to Collect Student Loan Servicing Data (Federal and Private), April 24, 2017

Making Federal Student Loan Servicing Work for Borrowers, November 2014

Making Student Loan Servicing Work for Borrowers, June 2014

Bipartisan House Bill is a Significant Step Forward in the Fight to Stop Unwanted Robocalls


National Consumer Law Center contact:  Jan Kruse, or (617) 542-8010

Washington, D.C. – Today, the Stopping Bad Robocalls Act was introduced in the U.S. House of Representatives by Rep. Frank Pallone (D-NJ) and Rep. Greg Walden (R-OR), chair and ranking member, respectively, of the U.S. House Committee on Energy and Commerce. The bill is also sponsored by Rep. Mike Doyle (D-PA) and Rep. Bob Latta (R-OH). “This bipartisan bill is an important step forward in the fight to stop unwanted and illegal robocalls,” said National Consumer Law Center Senior Counsel Margot Saunders.

The bill would provide new protections from robocallers by requiring the Federal Communications Commission to 1)  issue comprehensive regulations to stop unwanted and illegal automated calls and texts, 2) implement meaningful call authentication technology (so Caller ID is once again reliable),  and 3) ensure that call blocking programs are not charged to consumers. The bill also requires the FCC to create a database that callers can check to avoid making robocalls to a telephone number that has been reassigned to someone else.  It incorporates all the protections of the TRACED Act recently passed by the U.S. Senate, and goes farther by making the TRACED Act’s call authentication and call blocking requirements applicable not just to the largest phone companies, but also those serving rural areas..   

“There’s still more to be done and there is a lot of responsibility placed on the FCC to protect consumers,” added Saunders. “Robocalls plague voters of all political stripes so we are  especially pleased to see a bipartisan effort on this bill. We hope this is the first of several positive steps that Congress will take.”

Robocalls surged after a 2018 decision from the U.S. Court of Appeals in D.C. that set aside a 2015 FCC order on the question of how to interpret the Telephone Consumer Protection Act’s (TCPA’s) ban on autodialed calls to cell phones without the called party’s consent. This decision raised the specter that the prohibition might be interpreted not to cover the autodialing systems that are currently used to deluge cell phones with unwanted calls. Last year, Americans received more than 47 billion robocalls, with 60 billion estimated for this year. In May 2019, 9 of the top 10 robocallers were collectors attempting to collect on debts owed to well-known businesses, including Capital One, Wells Fargo, Santander, and Comcast, according to YouMail.

More information on NCLC’s extensive work on illegal robocalls is available at:

Statement: Nearly 50 Organizations Oppose FCC Proposed Cap on Universal Service Fund


National Consumer Law Center contact: Jan Kruse, or (617) 542-8010

Washington, D.C.- The parties listed below make the following joint statement regarding the Notice of Proposed Rulemaking (NPRM) issued by the Federal Communications Commission proposing to place a cap on the federal Universal Service Fund (USF):

“When Congress codified the concept of universal service by enacting the Telecommunications Act of 1996, it called for the creation of different programs tailored to promote affordable communications services for those most in need, from students, library patrons and rural hospitals to low-income and rural communities. Grouped under a single umbrella of the Universal Service Fund, these programs are intended to work in concert to address the “digital divide” and ensure that all consumers have access to high-quality and affordable communications. Indeed, our nation’s economic well-being and the well-being of people and businesses in rural and low-income communities require universal access to affordable, quality, high-speed broadband.

“The parties listed below believe that placing an overall cap on the USF puts at risk the comprehensive mission of universal service as Congress intended and articulated it. An overall USF cap, even if sized to meet current overall demand or the sum of authorized levels plus inflation, could still end up pitting these essential programs against each other in the future and undermine efforts to solve the “digital divide.” By contrast, the 1996 Act specifically directs the FCC to ensure that the Universal Service Fund has “sufficient” funding, and the FCC must therefore evaluate and size each program to suit its unique and essential universal service mission. An overarching cap would thus undermine efforts to ensure that funding for each program is and will remain “sufficient” to satisfy Congress’ mandates for universal service for all.

“For these reasons, the organizations and associations listed here respectfully oppose the imposition of an overall cap on the Universal Service Fund.”

AASA, The School Superintendents Association

Access Humboldt

Advanced Data Services, Inc. (ADS)

Advocates for Basic Legal Equality (ABLE)

Alliance for Excellent Education

American Civil Liberties Union (ACLU)

American Library Association (ALA)


Asian Americans Advancing Justice │AAJC

Association of Educational Service Agencies

Benton Foundation

Center for Rural Strategies

Chief Officers of State Library Agencies (COSLA)

Citizens Coalition

Common Cause

Common Sense Media

Communications Workers of America

Conterra Networks

Consortium for School Networking (COSN)

Consumer Federation of America (CFA)

Free Library of Philadelphia

Georgia K-12 CTO Council


Illinois Educational Technology Leaders (IETL)

Infinity Communications & Consulting, Inc.

Institute for Local Self-Reliance

The Leadership Conference on Civil and Human Rights

Louisiana CTO Council


Midland Council of Governments

Missouri Educational Technology Leaders (METL)

Mobile Beacon


National Association of State Boards of Education

National Collaborative for Digital Equity (NCDE)

National Consumer Law Center, on behalf of its low-income clients (NCLC)

National Digital Inclusion Alliance (NDIA)

National Hispanic Media Coalition (NHMC)

National Rural Education Association

National Rural Education Advocacy Consortium

National Tribal Telecommunications Association

Native Public Media

Next Century Cities

North Central Ohio Computer Cooperative (NCOCC)

Northern Buckeye Education Council

NTCA – The Rural Broadband Association

New America’s Open Technology Institute (OTI)

New York State Association for Computers and Technologies in Education (NYSCATE)

OCA – Asian Pacific American Advocates

Pennsylvania Association for Education Communications and Technology (PAECT)

Rural Wireless Association, Inc.

Schools, Health & Libraries Broadband (SHLB) Coalition

SouthWest Ohio Computer Association (SWOCA)

State Educational Technology Directors Association (SETDA)

Texas K-12 CTO Council

Tri-County Computer Services Association

Tribal Digital Village Network (TDVNet)

United Church of Christ, OC Inc. (UCC OC Inc.)

Urban Libraries Council (ULC)

Velocity Fiber

Virginia Society for Technology in Education (VSTE)


WTA-Advocates for Rural Broadband

Yavapai County Education Service Agency

Consumer and Civil Rights Groups Send Letters to FDIC, OCC, and Fed Urging them to Prevent Bank Payday Loans


National Consumer Law Center contact: Jan Kruse, or (617) 542-8010

Letters come after news that regulators pursuing joint small-dollar policy; Growing concern that several Administration appointees may be giving green light for predatory loans

WASHINGTON, D.C. – Today, the National Consumer Law Center (NCLC) joined a coalition of national civil rights and consumer groups in writing to top banking regulators on the importance of preventing banks from once again issuing payday loans that trap people in a cycle of debt. The groups pointed to a recent letter from more than 400 organizations to the Consumer Financial Protection Bureau (CFPB), which “prominently stressed the dangers of bank-issued payday loans in addition to those of non-bank payday lenders.”

These new letters were sent to the Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC), and the Federal Reserve (Fed) by Americans for Financial Reform, the Center for Responsible Lending, Consumer Federation of America, The Leadership Conference on Civil and Human Rights, the NAACP, and the National Consumer Law Center (on behalf of its low-income clients).

The letters urged the regulators to “listen to the voices of Americans across the country who have spoken out so strongly in opposition to high-cost, balloon payment loans.”

The letters also pointed out: “When bank payday loans were on the market, two-thirds of fees came from people who on average borrowed 15 or more times a year, many of whom took out loans 10 or more months a year.”

A link to letter to the FDIC is here.

A link to letter to the OCC is here.

A link to letter to the Fed is here.

The letters echo recent concerns over the National Credit Union Administration’s proposal to loosen standards in the Payday Alternative Loan (PAL) program.

National Consumer Law Center Attorney to Testify on June 11 before U.S. House Oversight Committee on Student Loan Servicing


National Consumer Law Center contact: Jan Kruse, or (617) 542-8010

Joanna K. Darcus’s full testimony will be available by 10am ET on June 11 at:

Washington, D.C.- National Consumer Law Center attorney Joanna K. Darcus will testify on Tuesday, June 11 at 10am E.T. before the U.S. House Financial Services Committee’s Oversight and Investigations Subcommittee at a hearing entitled “An Examination of State Efforts to Oversee the $1.5 Trillion Student Loan Servicing Market.”

In her testimony, Darcus will note that the U.S. Department of Education data shows that nearly a quarter of the more than 43 million federal student loan borrowers are in distress on their loans. These borrowers need high-quality, timely assistance. Unfortunately, as extensively documented, the student loan servicing industry has long been rife with misconduct.

The consequences of servicers’ misconduct are significant and, at times, catastrophic for borrowers’ financial lives. According to an April 2017 CFPB report based upon student loan borrower complaints, sloppy practices by servicers created obstacles to repayment, raised the costs of debt, caused distress, and ultimately contributed to driving struggling borrowers to default.

In particular, many eligible borrowers are not enrolled in income-driven repayment (IDR) plans despite clear benefits to the financial health of borrowers and their families. Instead, servicers steer many borrowers into forbearances and deferments, which are profitable for the servicer and costly to the borrower.

Servicer misconduct leading to default exposes borrowers to aggressive federal debt collection practices. The amount the government seizes using wage garnishment and offsets of Social Security and tax refund (including the Earned Income Tax Credit) often is far greater than the payments borrowers would have been required to make under an IDR plan. The consequences of default include damage to borrowers’ credit histories, increasing the cost of access to further credit and potentially erecting barriers to accessing employment and housing.

Darcus will also discuss how quality servicing is especially critical for addressing racial disparities in student loan outcomes, citing a Brookings Institution 2016 analysis by Judith Scott-Clayton & Jing Li that found, on average, that Black students graduated with about $7,400 more student loan debt than their White peers. Additionally Black and Latino students are also targeted for enrollment and overrepresented in high-cost, low-quality predatory schools.

Borrowers harmed by servicer misconduct need real relief. Reining in servicing misconduct and errors requires robust public oversight at the state and federal levels. Although some states have stepped up to protect their residents, borrowers nationwide also need and deserve for the Consumer Financial Protection Bureau to provide stronger oversight and for federal loan servicers to provide better assistance.

Protect Consumers from Harassing and Abusive Debt Collection Tactics

The Consumer Financial Protection Bureau has proposed a debt collection rule that does more to protect abusive collectors than consumers. Public comments are due August 19, 2019.

Urge the CFPB to strengthen the rule to protect consumers from harassment, abuse and deception by debt collectors, including collection attorneys, and to ensure that consumers receive important information about their rights.

Submit a Comment || Other Actions You Can Take

The proposed rule would allow collectors to:

  • Ring you 7 times per week, per debt. A consumer with 8 medical debts could hear the phone ringing up to 56 times a week!;
  • Contact you by text, email, or direct message without your permission, and send important information through hyperlinks;
  • Sue you without the collector’s attorneys reviewing original account documents to make sure you are the right person and the debt is the right amount and;
  • Collect debt that is so old that the deadline for a lawsuit has passed and records of who owes the debt and for how much may be lost.

See our issue brief for more on what the proposed rule does and our recommendations for strengthening it.

 How You Can Comment

  • Email directly to via our convenient portal.
  • Be sure to include Docket No. CFPB-2019-0022.
  • Submit comments to via our convenient portal.
  • By mail to Comment Intake-CFPB, 1700 G Street, NW, Washington, DC 20552

Other Actions You Can Take

  • Tell us your story.  Have you been harassed by debt collectors calling? Are you getting email, text, or direct messages from debt collectors?  Have you been sued in a collection lawsuit where you didn’t owe the debt or the amount claimed was incorrect? Have you been contacted by a collector asking you to pay a very old debt? Then tell us your story.
  • Find an attorney to help stop abusive debt collection practices.
  • LEARN MORE about the CFPB’s debt collection rule and NCLC’s work to promote fair debt collection.

Statement re: FCC Approves Phone Companies Proactively Blocking Robocalls


CONTACTS: National Consumer Law Center: Jan Kruse ( or (617) 542-8010; Margot Saunders (

National Consumer Law Center Senior Attorney Margot Saunders issues statement on FCC proposal calling it “a meaningful first step, but not a magic bullet.”

WASHINGTON, D.C.–Today, the FCC unanimously approved a proposal to grant phone service providers the authority to proactively block robocalls that its analysis determines are automated and likely illegal or unwanted. The proposal comes on the heels of the U.S. Senate’s overwhelming approval of the bipartisan “TRACED Act” which would mandate the FCC to require that providers  employ similar call-blocking authority as well as force implementation of call authentication technology known as STIR/SHAKEN.

National Consumer Law Center Senior Attorney Margot Saunders, a national expert on robocalls and the Telephone Consumer Protection Act (TCPA), issued the following statement on the approval of the proposal:

“We recognize the FCC’s actions today as a meaningful step toward ridding consumers of unwanted and harassing robocalls, but it’s not a magic bullet. Consumers must insist that Congress and the FCC go further towards restoring the use of their cellphones and restoring their faith in the modern communications infrastructure.

“Today’s order only grants phone companies permission to block robocalls; it does not require them to do so–and proponents and opponents of the proposal have raised understandable concerns about the accuracy of phone companies’ analysis regarding which calls will be blocked. It is unclear how the phone companies will identify and determine whether to permit or block robocalls primarily falling into four categories–scams, wanted calls (such as Rx reminders and school closing notices), unwanted but legal calls (such as debt collection calls with prior consent to call), and illegal debt collection and telemarketing calls made without prior consent or after consent has been revoked.

“Call blocking is a valuable tool and call authentication measures are essential going forward, but the measures are by no means a complete fix. A critical piece to remedy the nation’s runaway robocall epidemic is a strong interpretation of the federal TCPA, which shields consumers from autodialed and prerecorded calls to their cell phones without consent, and strong FCC enforcement of the rules to rein in robo-harassment.

“Debt collectors and other prolific robocallers should follow the rules on who can be called and who is telling them to stop calling and then they must actually stop calling. Service providers must also be aware of who owns the numbers they have provided so that call authentication can provide a viable source of relief for consumers inundated with scam, spoofed, unwanted, and illegal robocalls.”

For more information, state-by-state robocall data, and recommendations, visit NCLC’s Robocalls and Telemarketing page.

National Consumer Law Center’s 50th Anniversary Celebration

Celebrating our Legacy, Launching our Future

November 15, 2019
Boston Sheraton Hotel

On November 15, 2019 the National Consumer Law Center will commemorate five decades of high-impact advocacy for consumer rights and economic justice, and launch our next chapter in the presence of 750 consumer attorneys, advocates, and activists from our Boston hometown and across the nation. Guests will hear from nationally-recognized speakers and consumer champions as we gather for this once-in-a-generation celebration.

The 50th Celebration will take place during our annual Consumer Rights Litigation Conference. Please follow this link below to purchase Celebration tickets or review information for the conference.

Purchase tickets

Consumer Rights Litigation Conference Registration

Event Sponsorship

Interested in sponsoring the 50th Celebration and having your name in the lights? Please feel free to review our sponsorship opportunities and reach out to Paul Laurent at or 617-542-8010 with any questions you may have.


Honorary Committee

U.S. Senator Elizabeth Warren
U.S. Senator Ed Markey
U.S. Senator Sherrod Brown
U.S. Representative Katie Porter
U.S. Representative Ayanna Pressley
Attorney General Maura Healey
Steve Grossman, Former State Treasurer and DNC Chair
Richard Cordray, Former CFPB Director