CFPB finally disburses checks to Prehired victims following pressure from AGs

SEATTLE — The federal Consumer Financial Protection Bureau (CFPB) is finally providing long-delayed restitution to victims of a predatory tech sales program in Washington and other states after their attorneys general pressed the agency for answers in May.

In a May 6 letter to the CFPB’s acting director, Attorney General Nick Brown and 11 other state attorneys general detailed how a 2023 court order against Prehired LLC for illegal, deceptive and abusive practices resulted in $4.2 million in restitution for some 660 consumers nationwide, yet unexplained delays kept those checks from being distributed by the CFPB.

The CFPB announced the allocation in May 2024. For the remainder of 2024, states received regular updates regarding the federal government’s progress on distributing these funds to Prehired’s victims. But in February of this year, the CFPB stopped providing information about the process.

That changed after the attorneys general publicly pressured the agency to act. This week the CFPB confirmed checks are being sent. Our office is still gathering information about how many individuals have received restitution so far.

“I appreciate the CFPB finally releasing restitution to victims,” Brown said. “After waiting years for justice to be done, I hope this development helps people move on from this awful experience.”

Washington state sued the South Carolina company and its founder in 2022 for violating Washington’s Consumer Protection Act, Private Vocational Schools Act, and Collection Agency Act. The state alleged Prehired used deceptive marketing tactics to lure Washingtonians into paying up to $30,000 for Prehired’s unlicensed online sales training program. Most students could not afford to pay, and Prehired offered them income-share loans, which it represented were not loans.

The company “guaranteed” students would land tech sales jobs paying $60,000 or more. Meanwhile, the company demanded monthly payments from students who were earning far less. When students failed to pay on massive debt from the program, Prehired pursued aggressive collection techniques such as filing lawsuits and initiating arbitration proceedings against students across the country.

The state later joined other state attorneys general along with the CFPB in a consumer protection enforcement action against Prehired, resulting in the court order that Prehired return $4.2 million to those who made payments on the company’s loans.

Joining Washington in the letter were the states of Colorado, Delaware, Illinois, Massachusetts, Minnesota, New York, North Carolina, Ohio, Oregon, South Carolina, and the California Department of Financial Protection and Innovation.

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