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Home New Cases Consumer Advocacy Center Trustee Seeks to Recover Fraudulent Transfers Worth $4.8M From The Brea Financial Group, LLC, Alleging Student Loan Fraud

Consumer Advocacy Center Trustee Seeks to Recover Fraudulent Transfers Worth $4.8M From The Brea Financial Group, LLC, Alleging Student Loan Fraud

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January 16, 2021, Southern District of Florida – Last week, Sonya Salkin Slott, as a Chapter 7 Trustee for Consumer Advocacy Center, Inc. (the “Debtor”) brought lawsuits to avoid and recover fraudulent transfers from nine defendants. The lawsuits allege that the Debtor operated a fraudulent student debt relief enterprise that scammed consumers millions of dollars.

The largest claim so far had been filed against Defendants – The Brea Financial Group, LLC d/b/a Pub Club Leads for $4,835,268.57 and Adam Sthay for $110, 240.00

Defendant Pub Club is a lead generation and marketing company and Adam Sthay is the Chief Executive Officer of the Defendant. The Debtor and Defendant entered into a marketing agreement in 2015. According to the agreement, Defendant was to “provide traffic that creates customer inquiries in the form of valid leads”.

In its complaint, the Trustee argues that the Debtor allegedly utilized Defendant as a fuel, which drove its consumer debt relief scheme. In exchange, the Debtor purportedly paid millions of dollars to the Defendants. This provided no legitimate benefit to the Debtor’s illicit and unlawful operation. The consumers ostensibly paid millions of dollars to the Debtor and received little, if anything, in return. As alleged, the consumers neither got their debts paid nor settled/resolved. Instead, consumers were left in worse financial positions.

The Trustee further alleges that while the Debtor purported to help federal student loan borrowers obtain loan forgiveness or lower monthly payments through programs administered by the U.S. Department of Education, it instead deceived consumers by misrepresenting that they would qualify for loan forgiveness in a matter of months when forgiveness takes at least 10 years of on-time payments and is determined by the Department of Education.

The case is In re Consumer Advocacy Center, Inc., Adversary Proceeding No: 21-01007-SMG in United States Bankruptcy Court for the Southern District of Florida. Honorable Judge Scott M Grossman is presiding over the Debtor’s bankruptcy cases.

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Jones & Associates

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