“Prehired will void all outstanding income share agreements, refund harmed borrowers, and permanently cease operations”
In a recent announcement, the Consumer Financial Protection Bureau (CFPB) and 11 states have taken action against Prehired, a company that promised job placement to students but ended up causing harm to borrowers.
Here’s what you need to know:
- False Promises: Prehired attracted students by promising job placements and claimed that students wouldn’t have to repay their loans until they secured a job.
- Violated the Law: The loans Prehired offered, known as “income share” loans, violated the law because they were structured in a way that could trap borrowers in debt.
- Abusive Debt Collection: When borrowers couldn’t make payments, Prehired resorted to aggressive debt collection practices.
To address these issues, the CFPB and the states took legal action.
Here’s what’s happening:
- Prehired will provide over $30 million in relief to affected student borrowers.
- They are required to cease all operations.
- Prehired will pay $4.2 million in redress to consumers impacted by their illegal practices.
- All outstanding income share loans (valued at nearly $27 million) are voided and cannot be collected.
- Prehired is permanently banned from offering income share loans or any activities related to vocational education.
- A civil money penalty will be paid to the CFPB victims relief fund.
This action aims to provide redress to students who were misled by Prehired’s false promises and to hold the company accountable for its actions.
If you have been affected by Prehired’s practices, you can find more information at https://www.prehiredclaims.com/ or contact the CFPB for assistance.
Remember, it’s crucial to be cautious when considering financial opportunities and loans to ensure you’re making informed decisions.
