Attorney General Kathy Jennings, along with leaders from eight other states, has called on the Consumer Financial Protection Bureau (CFPB) to expedite restitution payments to victims of a predatory tech sales program. In a letter addressed to the CFPB's acting director, the coalition highlighted that a court order against Prehired LLC had mandated $4.2 million in restitution for approximately 660 consumers nationwide. However, delays at the agency level have prevented these funds from being distributed.
The court order was issued in November 2023, and by May 2024, the CFPB had announced fund allocation. States received updates throughout 2024 about the distribution process. However, communication ceased in February this year.
"Prehired’s victims include consumers from each of our respective states…and nearly every other state in the nation," stated the letter. "The CFPB committed to provide relief to these consumers when it made the allocation from the Civil Penalty Fund."
Prehired used deceptive marketing strategies to entice consumers into paying up to $30,000 for its unlicensed online sales training program. The company promised students would secure tech sales jobs earning $60,000 or more but demanded payments even when students earned less. When payments were not made, Prehired pursued aggressive collection methods.
State attorneys general joined forces with the CFPB in a consumer protection enforcement action against Prehired, leading to a court order for restitution.
AG Jennings' Consumer Protection Unit began investigating Prehired in early 2022 after nearly 300 debt-collection lawsuits were filed by Prehired in Delaware courts. These actions were dismissed following intervention by Jennings' unit due to concerns over defendants residing outside Delaware without means of defense.
The letter calls on the CFPB to provide a timeline for distributing funds and an explanation for delays.
Joining Delaware are Washington, Illinois, South Carolina, Oregon, Minnesota, California, North Carolina and Colorado.