On May 6, the attorneys general from 11 states and the California DFPI urged the CFPB to prioritize the distribution of $4.2 million in consumer restitution, following a bankruptcy court judgment against a company for UDAP violations. As previously covered by InfoBytes, the CFPB had joined a multistate suit alleging that the company orchestrated a predatory online training bootcamp, misled students with false job guarantees, and trapped them in illegal “income share” loans. In 2023, the CFPB obtained a stipulated judgment ordering the company to refund $4.2 million to over 660 student borrowers and cancel outstanding loans valued at nearly $27 million (covered here).
As part of the judgment, the CFPB allocated funds from its civil penalty fund to compensate the student borrowers. In their letter, the attorneys general requested a timeframe for when the CFPB plans to distribute these refunds.
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