WASHINGTON, D.C. — In a recent settlement with the Federal
Trade Commission, two California-based companies and their principals, who
allegedly took hundreds of thousands of dollars from consumers, are banned from
marketing auto loan relief or any other type of debt relief to consumers.

The FTC filed charges against the companies — Kore Services,
doing business as Auto Debt Consulting, and NAFSO VLM, doing business as
Vehicle Loan Mod — and their principals last year.

The FTC alleged that the defendants promised to reduce
consumers' monthly auto loan payments by 25 to 40 percent, for fees ranging
from $350 to $799. The defendants offered a 100 percent money back guarantee.

According to the FTC, many consumers were told to stop
making payments on their loans, which increased the risk that their vehicles
would be repossessed. But once the up-front fees were collected, the agency
said the defendants did not do anything to obtain the promised loan
modifications. Consumers who tried to get refunds were denied. And some
consumers' vehicles were repossessed by their finance companies.

The settlement bans the defendants from providing any type
of debt relief service, prohibits them from making misrepresentations about any
other product or service they market and requires them to support claims with
competent and reliable evidence.

In addition, the defendants are required to destroy customer
information obtained by the loan modification scheme within 30 days after the
settlement order takes effect.

The settlement also imposes a $279,728 judgment against the
defendants, which represents the total amount of consumer injury they allegedly
caused by deceptively marketing auto loan relief to cash-strapped consumers.

Officials said the companies' available assets will be
turned over to the FTC.

The judgment against Michael Kamfiroozie and Naythem Nafso
will be suspended due to their inability to pay. If it is later determined that
the financial information the individual defendants provided to the FTC was
false, the full amount of the judgment will become due.

The agency emphasized this case is part of the FTC's ongoing
effort to protect consumers in financial distress and to halt unfair or
deceptive practices in the auto marketplace.

Continue the conversation with SubPrime Auto Finance News on LinkedIn and Twitter.