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Student Loan Debt Relief Fraud

FTC says student loan debt “relief” companies relieved consumers of money, but didn’t live up to promises

By:  Lesley Fair       |        May 8, 2023

Is there a family, community, or company not impacted by the national student loan debt burden, which currently totals about $1.75 trillion? Even more distressing is that a substantial chunk of that debt is already in default. The FTC has gone to court to challenge the conduct of two outfits that pitch allegedly bogus student loan repayment and forgiveness programs, in violation of the FTC Act, the Telemarketing Sales Rule, and the Gramm-Leach-Bliley Act. One pending complaint names SL Finance LLC and the other names BCO Consulting Services Inc., and SLA Consulting Services, Inc. The action against SL Finance also alleges they violated the COVID-19 Consumer Protection Act by falsely representing their services were part of a COVID relief program.

The complaints charge that the defendants have taken in millions of dollars through telemarketing promotions that convey to consumers that buying the companies’ services will enroll them in loan repayment programs that will result in having all or part of their student loans forgiven. The FTC says the defendants also claim that most or all of the money consumers pay them will be applied to their balances and that the companies will assume responsibility for servicing consumers’ loans. SL Finance takes it one step further by representing that their program is part of the CARES Act or some other federal COVID-19 relief program. And just in case people might be suspicious of out-of-the-blue offers of student loan debt relief, both SL Finance and BCO Consulting Services tout purported affiliations with the Department of Education.

That’s the pitch, but how do the companies’ promises stack up to the truth? Not well, alleges the FTC. Despite those representations of relief, the FTC says the defendants simply relieved consumers already struggling with student loan debt of money each of them shelled out for help. Where did that cash go? According to the complaints, into the defendants’ pockets. 

The FTC says the defendants often don’t apply for – much less obtain – legitimate federal repayment plans on consumers’ behalf and don’t apply consumers’ payments to their loan balances. Furthermore, the defendants aren’t federal loan servicers. So despite their representations, they don’t take over or buy consumers’ student loans. Instead, the FTC says they insert themselves between borrowers and their servicers, and even instruct consumers to ignore their current servicers.

In addition, the complaint alleges SL Finance’s representatives falsely claim they are “affiliated” with the federal government (or specifically the Department of Education), that they are “contracted” by the federal government, or even that they are the federal government. The lawsuit against BCO Consulting charges that their representatives claim to “work” with or are “affiliated” with the government (or the Department of Education, in particular). No matter how the defendants’ telemarketers word it, the FTC says any government affiliation claim is flat-out false.

The lawsuits allege the defendants violated the FTC Act and the Telemarketing Sales Rule by misrepresenting their purported services and by collecting advance fees for debt relief services. The Gramm-Leach-Bliley Act count charges that they used deceptive tactics to get consumers’ financial information. In addition, the complaint against SL Finance alleges they called numbers on the Do Not Call Registry, failed to pay required Do Not Call Registry fees, and violated the COVID-19 Consumer Protection Act by falsely representing their services were part of the CARES Act or some other COVID-related program.

The complaint against SL Finance LLC names owners Michael Castillo and Christian Castillo. The BCO Consulting Services lawsuit names owners Gianni Olilang, Brandon Clores, Kishan Bhakta, and Allan Radam.

The FTC obtained a temporary restraining order that, among other things, prohibits the  defendants’ unlawful practices, appoints a receiver to take over the corporations, and imposes a freeze on defendants’ assets. Even at this early stage, the cases should send a strong warning that the FTC will take notice if companies attempt to exploit the student loan debt crisis for personal gain. Phony government affiliation claims are also looked upon unfavorably.

If you’re dealing with student loan debt – or if you have colleagues, friends, or family members who are struggling financially – here’s the straight story. You don’t have to pay for help managing student loans. If you have federal student loans, start at If your loans are private, go directly to your loan servicer. It’s their job to help you – for free. And if you spot a scam, tell the FTC about it at


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