5 states, including Minn. and ND, settle with company over student loan issues
ST. PAUL—Minnesota and four other states reached a $500,000 settlement with a company they say was "making abusive and harassing phone calls to increase student loan payments."
Commerce Commissioner Mike Rothman announced Friday, Aug. 11, that iQor Holdings agreed to the settlement.
"Our investigation uncovered student loan debt collection practices that deliberately violated consumer protection laws to boost payments and meet revenue targets," Rothman said. "This settlement will ensure that the company changes how it does business so consumers are protected against abusive calls and other unfair treatment."
iQor companies that the five states said were at fault, Allied Interstate and The Receivable Management Services Corp., agreed to reform their business practices, including training employees in reporting potential wrongdoing.
The firms refused to "provide timely, full access to all collection records and failed to submit complete responses to requested information in a timely manner, as required under state laws," the Minnesota Commerce Department reported.
The Commerce Department reported that in order to meet revenue goals, Allied Interstate debt collectors were directed to call phone numbers that had previously been marked as "do not call" and take actions to avoid potential disciplinary action for violating consumer protection requirements and company policy.
The five states—including North Dakota, Connecticut, Idaho and Massachusetts—will evenly split the $500,000.