Attorney General Ellison secures relief for student-loan borrowers hurt by misconduct

Former Minnesota ITT students to receive $1.6M in loan relief; California student-debt company to pay to fully refund Minnesota consumers for illegal fees

October 9, 2020 (SAINT PAUL) — Minnesota Attorney General Keith Ellison announced court approval of two recent settlements that affect hundreds of Minnesota student-loan borrowers.  

“Minnesotans take out student loans in good faith so they can get educations that will help them better afford their lives. My office is showing once again that when companies take advantage of that good faith or exploit borrowers mired in student debt, we will come after them,” Attorney General Ellison said. “I encourage any Minnesotan who’s been affected by these companies or others like them to contact my office so we can them accountable.” 

Settlement with ITT Loan Trust 

First, Attorney General Ellison secured an agreement to obtain nearly $1.6 million in debt relief for former ITT Tech students in Minnesota as part of a settlement with 48 attorneys general and the federal Consumer Financial Protection Bureau. Nationally, the settlement will result in debt relief of about $330 million for 35,000 borrowers who have outstanding principal balances.    

The settlement is with PEAKS Trust, a private loan program run by the for-profit college and affiliated with Deutsche Bank entities. ITT operated campuses in Brooklyn Center and Eden Prairie before it filed for bankruptcy in 2016 amid investigations by state attorneys general and action by the U.S. Department of Education to restrict ITT’s access to federal student aid.  

PEAKS had formed after the 2008 financial crisis when private sources of lending available to for-profit colleges dried up. ITT developed a plan with PEAKS to offer students temporary credit to cover the gap in tuition between federal student aid and the full cost of the education.  

According to the Assurance of Discontinuance approved on October 7, the attorneys general found that: 

Under the settlement, PEAKS agreed that it will forgo collection of the outstanding loans and cease doing business. It will send notices to borrowers about the cancelled debt and ensure that automatic payments are cancelled. The settlement also requires PEAKS to supply credit-reporting agencies with information to update credit information for affected borrowers.  

Students will need to do nothing to receive the debt relief. The notices PEAKS will send borrowers will explain their rights under the settlement.  Students may direct questions to PEAKS at or 866-747-0273or the Consumer Financial Protection Bureau at (855) 411-2372. 

In addition to Minnesota, the settlement was signed by the attorneys general of Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming. 

Settlement with California student debt-relief company

Ramsey County District Court has also approved a settlement that requires a California student-loan debt-relief company that was alleged to have illegally collected fees from customers to cease operating in Minnesota without a license and pay the State to account for full refunds to its Minnesota consumers.  

The company — EDU Doc Support, based in Fountain Valley, California — is one of a recent flood of debt-settlement companies promising loan forgiveness to consumers bogged down with student loans. As the Attorney General’s Office warns, these companies often charge consumers hundreds or thousands of dollars of illegal upfront fees to enroll them in repayment plans or consolidation loans that all eligible federal student-loan borrowers can apply for on their own for free through the United States Department of Education. The Attorney General’s Office has received many complaints in recent years of companies deceiving consumers into believing that the fees will go toward paying down the consumers’ student-loan debt, when the companies actually pocket the fees. The companies also often try to avoid oversight and registration as licensed debt-settlement service providers, as required by Minnesota law.  

The settlementapproved on October 8, requires EDU Doc Support to pay nearly $43,000 to the State for refunds to Minnesota consumers and to forego collection on an additional $22,000 owed by Minnesota consumers.  The settlement also requires the company to cease operating in Minnesota unless and until it registers as a debt-settlement service provider.  Attorney General Ellison’s Office alleges in the settlement that EDU Doc Support violated the consumer protections provided under Minnesota’s Debt Services Settlement Act. 

Attorney General Ellison encourages anyone who has been affected by EDU Doc Support’s business practices in Minnesota and wishes to claim payment of their refund to contact the Minnesota Attorney General’s Office by calling (651) 296-3353 (Metro area) or (800) 657-3787 (Greater Minnesota), or by submitting a complaint form on the Attorney General’s website at   

The Attorney General’s Office encourages borrowers to visit its website for additional information on how to avoid student-loan scams, including a publication entitled Student Loan Assistance Companies that Charge High Fees for What You Can Do for Free. Student-loan borrowers may access the United States Department of Education’s website — — for additional information about federal student-loan repayment programs available to all eligible borrowers for free.