Attorney General: Arrest in Student Loan Debt Case; Affected 19,000 Borrowers

COMMUNITY NEWS Attorney General: Arrest in Student Loan Debt Case; Affected 19,000 Borrowers

On Sept. 21, California Attorney General Rob Bonta announced the arrest of the leader of a nationwide, multiyear, multimillion-dollar student loan debt relief scam.

The defendant owned a network of third-party debt relief businesses based in Orange County. They employed managers and sales agents to operate multiple call centers that contacted individuals across the country promising to reduce or eliminate their federal student loan debt. Instead, the owner, as well as four call center managers and two sales agents allegedly stole over $6,130,000 in less than three years from over 19,000 victims, including 3,000 in California.

Two additional defendants have been arrested for their alleged connection to this scheme.

All of the defendants face multiple counts, including grand theft by false pretenses, computer access and fraud, and unauthorized use of personal identifying information. The lead defendant has been charged with all 87 counts of the indictment, as well as special allegations for money

The lead defendant has been charged with all 87 counts of the indictment, as well as special allegations for money laundering in excess of $2.5 million and aggravated white-collar crime.

laundering in excess of $2.5 million and aggravated white-collar crime.

“Millions of Californians — myself included — know what it’s like to finish your education, only to start the often decades-long journey of paying off your student loans,” said Bonta. “Life happens, and whether it be because a person is out of work, faces an unexpected medical bill, or other life change, many struggle to make those monthly payments. When greedy companies prey on vulnerable individuals and use misleading tactics to steal from them, they must be held accountable. I’m thankful to our local and federal law enforcement partners for their work in this investigation. Now, the work begins to bring to account those responsible for these alleged actions.”

“The victims are the most important people to remember in this case,” said Orange County Sheriff-Coroner Don Barnes. “All of the work of the entire team, including OC Sheriff’s investigators, is well worth the effort to provide justice for unsuspecting students who thought they were paying off student loans. While it’s an unfortunate reality, scammers will take advantage of victims for their personal financial gain. The best defense against these scams is to be informed about different types of fraud and how you can avoid becoming a victim.”

“This case demonstrates our shared commitment to protecting the U.S. taxpayer’s investment in the Federal student loan programs and we’re proud to be involved with this State, local, and Federal partnership that brought about today’s actions,” said Tom Harper, Jr., Special Agent in Charge of the U.S. Department of Education Office of Inspector General Technology Crimes Division, the unit that works to protect education programs and network infrastructure by investigating technology crimes. “This should serve as a warning to anyone operating these and other scams aimed at students and student borrowers: you will be caught and held accountable for your criminal actions.”

“The U.S. Postal Inspection Service is committed to protecting the U.S. mail from criminal misuse and is proud to be a part of this large-scale investigation with our law enforcement partners,” said Carroll Harris, Inspector in Charge of the Los Angeles Division. “Together we seek to stop these scammers involved in illegal computer access, fraud, identity theft, and money laundering from continuing to defraud and victimize thousands of individuals located throughout the United States.”

Between 2017 and 2020, sales agents from the third-party debt relief call centers contacted an estimated 380,000 student loan borrowers who were struggling to meet their monthly debt obligations.

“Student Loan Debt” page 26

“Mayor Brooke” from page 17

AB 361 sunsets on Jan. 1, 2024. At this time, Capitola City Council meeting will continue to be held virtually until we see a significant decrease of new cases of COVID-19 in our community.

Excellence in Financial Reporting

Last week staff was informed that the Government Finance Officers Association of the United States and Canada has awarded the Certificate of Achievement for Excellence in Financial Reporting to the City of Capitola for its Comprehensive Annual Financial Report for the Fiscal Year that ended June 30, 2020.

The report has been judged by an impartial panel to meet the high standards of the program, which includes demonstrating a constructive “spirit of full disclosure” to clearly communicate its financial story and motivate potential users and user groups to read the report.

The Certificate of Achievement is the highest form of recognition in the area of governmental accounting and financial reporting, and its attainment represents a significant accomplishment by a government and its management.

Capitola has received the Certificate of Achievement every year since Fiscal Year 2011-12 and prior to that received the Certificate for Outstanding Financial Reporting from the California Society of Municipal Finance Officers from 1999-00 through 2010-11.

Capitola Parks and Recreation

The Fall 2021 Brochure is now available. View it at: https://www.cityofcapitola. org/recreation

COVID-19 Mandatory Testing and Vaccination Policy

The City of Capitola has adopted a COVID-19 vaccination and testing policy requiring all staff to show proof of vaccination, or be PCR-tested twice a week.

Outdoor Dining Update

Temporary outdoor dining permits have been extended to Jan. 3, 2022; rules are also imposed on current permit holders to maintain outdoor dining areas to certain standards.

The Capitola City Council will review the temporary permits at the Nov. 10 meeting.

COVID-19 Small Business Rental & Mortgage Assistance Grants

The city of Capitola is pleased to announce a partnership with Santa Cruz Small Business Development Center to develop a grant program that provides economic relief to small businesses that were negatively impacted by COVID-19.

Using Community Development Block Grant Cares Act funding, the program offers up to $7,500 in grants to eligible applicants for use towards reimbursement of qualified rental or mortgage costs incurred between April 1, 2020, through Sept. 30, 2021.

An estimated thirty to thirty-five businesses are expected to benefit. If the number of qualifying applications received exceeds the amount of funding available for disbursement, the City will implement a lottery system for all eligible applicants. ELIGIBILITY

Applicants must meet the following criteria to be eligible: • Businesses must demonstrate a financial need as a result of COVID-19. • Legally operate as a for-profit, brick, and mortar business within the City of

Capitola. Home-based businesses do not qualify. • Business must be legally operating since January 2019. • Business must have 25 or fewer fulltime employees, or an equivalent combination of 25 full and part-time employees, including the owner. • A complete application must be received by the Sept. 30, 2021 deadline, and supported with required documentation. • Businesses must meet a CDBG

“National Objective.” • Applicants can be current on their rent or mortgage.

To learn more visit: https://www.cityof capitola.org/communitydevelopment/ webform/covid-19-small-business-rentalmortgage-assistance-cdbg-grant-program

Annual Golf Tournament

Capitola Foundation’s annual fundraiser turns 15 and takes place Oct.1. To learn more and to register visit https://capitolafoundation.org/golf/. All proceeds go to local nonprofits.

National Night Out!

The Capitola Police Department will host National Night Out on Tuesday, Oct. 5 from 5 to 7 p.m. at Jade Street Park. The event will feature a free BBQ, a meet and greet with the Chief and other police officers, and fun and games for all.

This event promotes police-community partnerships and neighborhood camaraderie, helping make our neighborhoods safer while growing community. The Capitola Police Department will be joined by the Central Fire District and American Medical Response. National Night Out is a great opportunity to bring neighbors and public safety organizations together in a relaxed and positive environment. n •••

As always should you have any questions feel free to email me at brooksforcitycouncil@gmail.com. You can also email citycouncil@ci.capitola.ca.us and your note will automatically be sent to all five Councilmembers, the City Clerk, and the City Manager.