Judge Freezes Assets of Alleged Student‑Loan Relief Operation That Collected Millions

A federal judge in California has temporarily shut down an alleged student loan debt relief scheme that the Federal Trade Commission says posed as the U.S. Department of Education and loan servicers while collecting millions of dollars in illegal upfront fees from borrowers.

In an ex parte temporary restraining order entered April 13, 2026, the U.S. District Court for the Central District of California froze the operation’s assets, ordered its websites disabled and imposed other emergency measures. The FTC’s press release says the operators “have collected at least $8.8 million from consumers,” while the court order finds that “defendants have taken in gross revenues of at least $9.8 million as a result of their unlawful practices.” The order, signed by U.S. District Judge James V. Selna, is part of case number 8:26‑cv‑00885‑JVS‑JDE, which remains pending.

The FTC’s complaint targets two companies — NERD Solutions Inc., doing business as New Education Relief, and ED REF Inc., doing business as Edvantage Relief — and their principals, Natalie Rodriguez and Pablo Eduardo Ortiz. According to the agency, since at least February 2022 the defendants marketed student loan debt relief services primarily by cold calling consumers, including people whose numbers were listed on the National Do Not Call Registry.

The FTC says callers falsely suggested they were connected to the Department of Education or to borrowers’ actual loan servicers. Using claims about student loan forgiveness or special relief programs, the operation allegedly induced people to sign up for services and pay substantial fees. The agency alleges the defendants charged illegal upfront monthly fees for debt relief services, in some cases as high as $1,400, despite federal rules that bar advance fees in these kinds of telemarketed debt relief programs.

The commission says the defendants’ tactics capitalized on confusion around student loan repayment and forgiveness programs. By presenting themselves as government-affiliated or tied to legitimate servicers, the operation allegedly persuaded borrowers to trust them with sensitive financial information and to divert money that could have gone toward actual loan payments.

Legally, the FTC’s complaint alleges violations of several federal consumer protection laws. Those include the FTC Act, the agency’s core statute prohibiting unfair or deceptive practices; the Telemarketing Sales Rule, which restricts advance fees for debt relief and bans most calls to numbers on the Do Not Call Registry; the Trade Regulation Rule on Impersonation of Government and Businesses, known as the Impersonation Rule; and the Gramm-Leach-Bliley Act, a federal financial privacy law that, among other things, requires safeguards for consumer financial data.

The temporary restraining order is designed to preserve money and records while the case moves forward. It imposes an asset freeze on the defendants, directs that their websites be disabled, and requires preservation of business records while granting FTC staff immediate access to premises and documents. The order also prohibits the sale or disclosure of consumers’ financial and identifying information gathered through the alleged scheme and instructs banks, payment processors and other asset holders to retain any related funds. The court set an order to show cause on whether to convert the TRO into a preliminary injunction.

The FTC says the Commission voted 2–0 to authorize filing the complaint. As the agency notes, a complaint is filed when the Commission has “reason to believe” the law is being or is about to be violated; whether the defendants broke the law will be decided by the court, not the FTC.

The case lands in a market where student loan debt is both vast and confusing. According to recent data from the Federal Reserve Bank of New York, Americans owe roughly $1.65 trillion in student loans, spread across tens of millions of borrowers. That scale makes student loan relief a frequent target for scams, and the FTC has repeatedly brought actions against companies that charge advance fees or impersonate the Department of Education or loan servicers.

The agency’s 2024 Impersonation Rule, which took effect April 1, 2024, explicitly bans falsely posing as a government agency or business or misrepresenting an affiliation with them. The FTC has now begun to invoke that rule, alongside the long-standing Telemarketing Sales Rule, in student loan enforcement cases such as this one.

For borrowers, the harm in these schemes can be severe. Money paid in illegal upfront fees is money not going toward loan balances, which can lead to missed payments, default and damaged credit. Handing over bank account and Social Security numbers also exposes consumers to additional financial risks, which is why the court’s order bars the defendants from selling or sharing that information.

In offering general guidance, the FTC’s press release reminds consumers that “The FTC will never demand money, make threats, tell you to transfer money, or promise you a prize.” The agency also publicly thanked the Ohio Office of the Attorney General for its “substantial assistance” in the investigation, underscoring the joint role of federal and state authorities in policing student loan relief scams.