In a major legal action, the Consumer Financial Protection Bureau (CFPB) and seven state attorneys general have filed a lawsuit against Strategic Financial Solutions (SFS) and its executives, Ryan Sasson and Jason Blust. The suit, initiated on January 10, 2024, accuses SFS of operating an illegal debt-relief scheme that swindled more than $100 million from financially distressed families. Cases like these, in which multiple plaintiffs suffered damages in the same manner, from the same defendants, are often tried as a class-action or mass tort claim, usually by a team of attorneys from different states and Washington, D.C., consumer fraud lawyers. You may opt to file your own suit in these matters, but many plaintiffs benefit from the combined resources in a class action.
The lawsuit alleges that SFS, alongside a network of shell companies and façade law firms, falsely marketed its services as a solution for debt relief while actually charging exorbitant and illegal fees. According to the CFPB and state attorneys general, SFS collected fees from consumers without providing the promised debt reduction services. Instead, consumers were left in worse financial conditions, with their money funneled through a web of deceptive entities controlled by Sasson and Blust.
The lawsuit claims that SFS charged advance fees before settling any debts and misled consumers into believing that affiliated law firms would negotiate lower payoff amounts. However, it is alleged that SFS employees, not actual lawyers, handled the negotiations, if any took place.
The CFPB, along with the attorneys general of Colorado, Delaware, Illinois, Minnesota, New York, North Carolina, and Wisconsin, is seeking to halt SFS’s unlawful practices, provide restitution to affected consumers, and impose civil penalties. A temporary restraining order was granted on January 11, 2024, to prevent further harm while the case progresses.
This legal action highlights ongoing concerns about fraudulent debt-relief practices and underscores efforts to protect vulnerable consumers from deceptive financial schemes.
What Are Your Options If You Were Swindled By A Debt Collection Service?
Dealing with debt collection can be a stressful experience, especially if you find yourself targeted by a fraudulent or unethical debt collection service. If you believe you’ve been swindled, there are several steps you can take to protect yourself and seek redress.
Start by confirming that the debt is legitimate and the collector is authorized to collect it. Request a written validation of the debt from the collector, as required by the Fair Debt Collection Practices Act (FDCPA). This should include details about the original creditor and the amount owed. Keep thorough records of all communications with the debt collector, including dates, times, and the content of conversations. Save copies of any written correspondence, emails, and voicemails. This documentation can be crucial if you need to prove your case.
If the debt collector is engaging in illegal practices, such as harassment, false representation, or threatening behavior, file a complaint with the Consumer Financial Protection Bureau (CFPB) or your state’s Attorney General’s office. These agencies can investigate and take action against unethical collectors. Finally, if fraudulent debt collection has affected your credit report, you have the right to dispute the entries with the credit bureaus.
If you have been defrauded by a credit recovery or collections agency, the legal team at Eric Siegel Law can demand recovery of your losses and guide you through your legal options. Contact us today for a free consultation.