Monster Loans ordered to repay $18

MONSTER LOANS ORDERED TO REPAY $18 MILLION TO CHEATED CUSTOMERS

“So easy…it’s scary” is a phrase that is commonly heard in California. The phrase is a tagline from a California mortgage company, Monster Loans. Recently, the company was allegedly involved in a complex scheme that illegally offered debt relief services to millions of Americans whose personal information was unlawfully obtained from Experian, according to Consumer Financial Protection Bureau (CFPB).

On May 14, the Bureau filed a proposed final judgment to resolve its allegations in its lawsuit against Chou Team Realty, LLC, which operates as Monster Loans, and other individuals and related companies such as Thomas Chou and Sean Cowell. CFPB alleged that Chou and Cowell, between 2015 and 2017, were at the frontline of a scheme to use Monster Loans account with a major credit bureau to unlawfully obtain consumer reports for their companies that offer student loan debt relief.

The debt relief companies used the consumer reports to deceptively market their services across the nation while illegally charging a fee. The debt relief companies are accused of having collected at least $15 million in the illegal fees before consumers received any adjustment to their student loans and any payments towards their adjusted loans.

According to the Bureau’s allegations, Monster Loans had pursued a series of other plans to further their scam. In 2017 the mortgage company allegedly helped to establish a fake company known as Lend Tech Loans, which presented itself as a mortgage brokerage. However, the company never engaged in any mortgaging activity. Instead, it “has only ever been used to unlawfully obtain consumer report information” that was used in furthering the student debt relief scheme. “As alleged in the complaint, because of Monster Loans’ assistance, Lend Tech Loans was able to wrongfully obtain consumer reports for over 12 million

additional consumers between 2017 and 2019,” the Bureau stated.

The Bureau alleges that Monster Loans, its former president Thomas Chou, its co-founder Sean Cowell, Lend Tech Loans, and a bunch of debt relief companies conspired to milk millions of dollars from Americans. “Chou and Cowell were officers of Monster Loans, investors in the student-loan debt relief companies, and allegedly helped create the sham entity Lend Tech Loans,” the Bureau said. “The Bureau alleged that they participated in the (Fair Credit Reporting Act) violations and then received purported profits from the studentloan debt-relief companies. As alleged in the complaint the profits represented funds that were wrongfully taken from consumers through unlawful conduct.”

The Bureau in mid-May stated that it had arrived at a settlement with Chou Team Realty that the firm had illegally obtained people’s information and given it to the debt relief companies. As part of the settlement, Monster Loans and its associated companies were ordered to repay $18 million to the affected customers. The settlement also imposed a redress judgment against Monster Loans and ordered Chou and Cowell to pay a civil penalty of $450,001. Beyond that, the settlement banned Monster Loans, Chou, and Cowell from

the debt relief industry.

However, the companies’ current financial situation indicates that they do not have that amount of money; therefore, they cannot repay the affected customers. In response to this, the Bureau required Monster Loans to submit its financial documents to prove that it does not have the money. If that is the case, the company will have to pay $200,000 in redress to the affected customers. If the case is not valid, the company will be required to pay $18 million in full. Most of the affected customers are unlikely ever to get their money back.

Let this scenario be a lesson to the public. It is recommendable to be extra cautious when interacting with any ads sent to you via email or text or those you find while surfing the internet. Some of the ads are nothing but scams to milk Americans their hard-earned money. If you want to interact with any ads, it would be wise to consult experts or the regulators before you get into it.

Works cited.

https://www.housingwire.com/articles/monsterloans-ordered-to-repay-18-million-to-cheatedcustomers-but-many-wont-get-their-moneyback/