On July 19, the Consumer Financial Protection Bureau reached a $107 million settlement agreement with three individuals who conspired with World Law Group to swindle millions of dollars from consumers in a debt-relief scheme.
In August 2015, the CFPB brought suit in U.S. District Court for the Southern District of Florida against several defendants, including the three individuals, for violations of the Consumer Financial Protection Act and the Telemarketing and Consumer Fraud and Abuse Prevention Act of 2010. The individual defendants are Derin Scott and David Klein, corporate executives of defendant corporation World Law Group, and Shannon Scott, wife of Derin Scott and signatory on accounts for World Law Group.
According to the CFPB, the defendants conspired around October 2010 to charge clients upfront fees, in violation of the Telemarketing Sales Rule’s prohibition on charging consumers advance fees for debt-relief services. Defendants attempted to dodge the prohibition by making false promises to provide legal services for debt-relief, including attorney representation. Additionally, the defendants provided consumers with poor legal advice by informing them to stop paying their debts, which resulting in collection lawsuits being initiated on behalf of the consumers’ creditors.
The settlement agreement was intended to disgorge the three individuals of all funds received from consumers during the conspiracy with World Law Group. Under a suspended judgment, the individual defendants are required to turn over to the CFPB the frozen assets in their personal bank accounts, commercial property, and several vehicles.
Litigation is still pending against remaining defendants Orion Processing LLC and Bradley Haskins. The case is Consumer Financial Protection Bureau v. Orion Processing, LLC, et al., No. 1:15-cv-23070.