The Federal Trade Commission (FTC) has taken decisive action against a fraudulent student loan debt relief operation, permanently banning the company and its owners from the industry. This follows allegations that they misled consumers into paying illegal fees for non-existent loan forgiveness programs.

The defendants, operating under names such as Panda Benefit Services and Prosperity Benefit Services, targeted individuals struggling with student loan debt. They falsely claimed that consumers who paid for their services were guaranteed loan forgiveness and would see reduced loan payments. Additionally, they misrepresented their affiliation with the U.S. Department of Education, misleading consumers into believing they would manage their loans while pocketing over $16.7 million in unlawful fees.

In a series of court rulings, the FTC secured default judgments against several entities involved in the scheme, including Public Processing Services and Quick Start Services. The final orders not only ban these defendants from the debt relief industry but also prohibit them from engaging in telemarketing and making false representations about other products or services.

As part of the court's ruling, a monetary judgment of nearly $16.8 million was imposed on Select Student Services and Eduardo Martinez, although much of it is suspended due to their inability to pay. They are required to turn over significant personal and business assets, with the stipulation that if they misrepresent their financial situation, the full judgment amount will become due.

The FTC emphasizes the importance of consumer protection in the student loan sector and has provided resources to help individuals avoid scams. Consumers seeking assistance with their student loans can access free help through StudentAid.gov.