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NC AG Josh Stein Wins Case Against Loan Company That ‘Trapped Students With Illegal Loans’

Source: WITN

State Attorney General Josh Stein announced days before Thanksgiving that he had won a court order against Prehired, a student loan company, that will give 22 North Carolinians justice – and debt relief, WITN reported.

As part of the order, Prehired will be shut down permanently and is also on the hook for paying more than $4.2 million in restitution to student borrowers harmed by their practices. They will also need to void almost $27 million in all outstanding loans.

Stein, along with a bipartisan group of 10 state attorneys general and the federal government, brought the case against Prehired to court, saying the company “made false promises about job placements, trapped students with illegal loans, and used abusive debt collection practices on borrowers,” according to WITN.

In North Carolina, 22 people made student loan payments to Prehired totaling $112,716.63, or about $5,123.48 per person. In total, North Carolinians may receive an estimated $1.1 million in contract cancellations.

“We will not allow predatory lenders to rob North Carolinians of their money and damage their futures,” said Stein. “I’m pleased that this order wins relief for students who were harmed and shuts down the company.”

According to Stein, Prehired operated a 12-week online training program that claimed to prepare students to get guaranteed jobs as entry-level software sales development representatives with six-figure salaries.

The lawsuit also states that Prehired offered “income share loans,” which require students to pay back the loans as a percentage of their income after graduating.

Stein sued Prehired in June, claiming that the company was breaking consumer financial laws by saying its loans weren’t actually loans, not informing borrowers about important parts of the loan agreement, using deceptive tactics to push borrowers into debt, and suing students in jurisdictions that were far from where they lived to make it harder for them to show up in court to dispute the cases.

According to Stein’s office, Prehired has already ceased operations and filed for bankruptcy, but will now be required to close for good.

Students who may be eligible can submit a claim by clicking here.

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