A federal judge has issued a temporary injunction against Superior Servicing and its operator Dennise Merdjanian, following FTC allegations that the company claimed to be affiliated with the Department of Education, collected illegal advance fees and made other deceptive claims.
The FTC charged that the company’s operators violated the commission’s Impersonation Rule by claiming to be affiliated with the Department of Education, as well as the FTC Act’s prohibition on deceptive practices, the FTC Telemarketing Sales Rule’s prohibition on the collection of advance fees and the Gramm-Leach-Bliley Act’s prohibition on making false, fictitious, or fraudulent representations to consumers to obtain or attempt to obtain information such as their banking account numbers and routing numbers.
In its complaint, the FTC alleged that since at least January 2023, Superior and Merdjanian made telemarketing calls and sent personalized mailers falsely claiming that consumers enrolled in defendants’ program could obtain benefits such as loan consolidation, reduced interest rates on their federal student loans, reduced monthly student loan payments, and loan forgiveness.
The FTC alleged that Superior collected illegal advance fees of up to $899 as an initial payment and monthly payments of $49 that it falsely claimed were going toward consumers’ federal student loan debt. The FTC said that Superior falsely pretended to work with or be affiliated with the Department of Education. In some cases, the company advised borrowers to stop making payments on their existing federal student loans.
But the FTC alleged that contrary to the promises made by Superior, borrowers reported they never received loan consolidations, lowered payments or loan forgiveness. The FTC said that at most, the defendants filled out applications for debt relief that are available for free from the Department of Education.