Consumer Financial Protection Bureau

The Consumer Financial Protection Bureau entered into a $1 million Consent Order with student-loan servicer Edfinancial Services, for allegedly making deceptive statements to student loan borrowers and misrepresenting their forgiveness and repayment options. Edfinancial allegedly deceived borrowers with Federal Family Education Loan Program loans about their eligibility for Public Service Loan Forgiveness. The settlement requires the company to contact all affected borrowers, provide them with accurate information, and pay a $1 million civil penalty.

Federal Trade Commission

The Federal Trade Commission (FTC) settled allegations that online fashion retailer Fashion Nova, LLC blocked negative reviews of its products from being posted to its website. Under the final order, Fashion Nova will pay $4.2 million and is prohibited from suppressing customer reviews of its products.

The FTC settled with WW International Inc., formerly known as Weight Watchers, and a subsidiary called Kurbo, Inc., for allegedly illegally collecting children’s sensitive health data. The settlement order requires WW International and Kurbo to delete personal information illegally collected from children under 13, destroy any algorithms derived from the data, and pay a $1.5 million penalty.

The FTC took action against Intuit Inc., the maker of the popular TurboTax tax filing software, for allegedly deceiving consumers with bogus advertisements pitching “free” tax filing that millions of consumers could not use. The FTC made the charges in an administrative complaint against the company and also filed a federal district court complaint asking a court to order Intuit to halt its deceptive advertising immediately.

The FTC announced a $2.425 million settlement with online investment site RagingBull.com, resolving allegations that it used bogus earnings claims to trick consumers into signing up for services and then trapped them into hard-to-cancel subscription plans with costly charges. In addition to the $2.425 million payment, the settlement requires the company to end the earnings deception, get affirmative approval from consumers for subscription sign ups, and provide them with a simple method to cancel recurring charges.

The FTC obtained a $2.3 million settlement with a payment processor who helped an alleged bogus discount club bilk consumers out of tens of millions of dollars. iStream Financial Services and senior officers will also face a permanent ban from working with high-risk clients. According to the complaint, iStream, working with the merchants, used a type of payment called a remotely created check to take money from consumers’ accounts without authorization.

The FTC obtained an order halting a credit repair operation that allegedly bilked consumers out of millions of dollars by falsely claiming to remove negative information from credit reports, while also filing fake identity theft reports to explain negative items on customers’ credit reports. The FTC’s complaint alleges that Turbo Solutions Inc., d/b/a Alex Miller Credit Repair, and its owner Alex V. Miller also demanded consumers pay a $1,500 fee up front, in violation of federal law.

Securities and Exchange Commission

The Securities and Exchange Commission (SEC) proposed amendments to its rules to enhance and standardize disclosures regarding cybersecurity risk management, strategy, governance, and incident reporting by public companies. The proposed amendments would require current reporting about material cybersecurity incidents and periodic reporting to provide updates about previously reported cybersecurity incidents.

The SEC charged siblings John and JonAtina (Tina) Barksdale with operating a $124 million crypto fraud scheme that allegedly defrauded thousands of retail investors purchasing securities involving a digital token called “Ormeus Coin.” As alleged in the complaint, in many investor communications, the defendants falsely stated that Ormeus Coin had a $250 million crypto mining operation and was producing $5.4 million to $8 million per month in mining revenues when in fact they abandoned their mining operations in 2019 after generating less than $3 million in total mining revenue.

In Other Federal News

The Federal Communications Commission (FCC) adopted an Order ending the ability of Pacific Networks Corp. and its wholly-owned subsidiary, ComNet (USA) LLC, to provide domestic interstate and international telecommunications services within the United States. The FCC took the action against these U.S. subsidiaries of a Chinese state-owned entity after receiving input from executive branch agencies, considering the companies’ responses in an FCC proceeding, and determining that the action was appropriate to safeguard the nation’s telecommunications infrastructure from potential security threats.

Other articles in this edition include:

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