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State AG Updates: June 28-29, 2021



Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.


  • The Consumer Financial Protection Bureau (“CFPB”) issued amendments to the federal mortgage servicing regulations to reinforce economic recovery as foreclosure moratoria expire. The rules, which become effective on August 31, 2021, will create temporary safeguards to ensure that borrowers may explore options prior to foreclosure, as well as create flexibility for mortgage servicers.

Consumer Protection

  • California Attorney General Bonta announced a proposed settlement against Voyageurs International, Ltd., resolving allegations that the travel company only offered partial refunds for a cancelled high school European trip and kept the remaining fees. The settlement requires the company to provide full refunds, totaling about $247,000 in restitution, as well as to comply with the Seller of Travel Act and cease charging consumers cancellation fees when it is unable or unwilling to provide the purchased services.

Deceptive Debt Relief

  • A complaint filed on June 27, 2021 in the Southern District of Florida is accusing law firm GM Law and associated entities of conducting a student loan debt elimination telemarketing scam to debtors. The lawsuit seeks declaratory relief and damages.


  • Connecticut Attorney General Tong led a coalition of attorneys general in calling on the Federal Energy Regulatory Commission to reject incentive payments to transmission developers to join regional organizations, which they generally have to join regardless. The coalition is arguing that the incentives, which will add to ratepayer costs, are unnecessary and unfair.

Federal Trade Commission

  • A bipartisan coalition of 28 attorneys general co-led by New York Attorney General James and Colorado Attorney General Weiser sent a letter to Congress expressing support for the Consumer Protection and Recovery Act (H.R. 2668), which would give the Federal Trade Commission (“FTC”) the power to obtain restitution. The coalition is arguing that if the FTC is not able to obtain restitution attorneys general must divert resources to perform duties that the FTC previously performed.

Financial Misconduct

  • North Carolina Attorney General Stein filed a lawsuit against companies Home Relief Services, Amstar Services, and Consumer Proponents & Associates Corporation and their principals for allegedly engaging in illegal debt adjusting, collecting unlawful advance fees, and falsely promising to reduce mortgage loan payments, obtain loan forbearance, and prevent foreclosures. The lawsuit seeks injunctive relief, cancellation of the associated contracts, civil penalties, restitution, and fees.

Medicaid Fraud

  • North Carolina Attorney General Stein announced that the former CEO of Extended Reach Day Treatment for Children and Adolescents, a Medicaid provider that provided day treatment and other behavioral health services, was sentenced for health care fraud. The settlement includes 24 months in prison and a $337,615 restitution payment. The defendant added extra treatment services that were not provided on claim submissions along with services actually given, as well as billed for psychotherapy services not provided by a doctor.

Tuesday, June 29, 2021


  • The Consumer Financial Protection Bureau (“CFPB”) issued a report outlining legal violations and prior supervisory findings leading to public enforcement in 2020. For example, the CFPB found that consumer reporting companies accepted consumer data from furnishers that were unreliable, violating the Fair Credit Reporting Act. The CFPB also found redlining, several violations of the Regulation X mortgage servicing rules, and misleading actions by student loan servicers.

Consumer Protection

  • Washington D.C. Attorney General Racine announced that before-and-after-school daycare program KCE Champions LLC is required to change its business practices and pay $250,000. An investigation found that the company unfairly deceived parents by failing to adequately disclose late fees, automatically withdrew payments without clear authorization, excessively called parents to collect fees, and dis-enrolled children if payments were not made for two weeks.

Medicaid Fraud

  • Vermont Attorney General Donovan announced a settlement with Health Care & Rehabilitation Services of Southeastern Vermont, resolving allegations that it violated the Vermont False Claims Act by submitting Medicaid claims for services provided by an employee on the exclusion list. The settlement requires the company to pay about $170,000 and adopt remedial measures.

State AG Office News

  • New Jersey Attorney General Grewal will be leading the enforcement division of the U.S. Securities and Exchange Commission beginning on July 26, 2021. He will name an interim attorney general this week to finish his term, which ends in January.

Unfair Debt Practices

  • Georgia Attorney General Carr and the Consumer Financial Protection Bureau announced that they entered into a consent order with Burlington Financial Group, LLC and its owners and executives resolving allegations that they violated the Telemarketing Sales Rule, the Fair Business Practices Act, and the Debt Adjustment Act with their advertising and sale of debt relief and credit repair services. The company allegedly misled financially vulnerable consumers, many elderly, into paying advance fees for services it falsely promised would eliminate credit card debt and improve credit scores, which ultimately left these consumers in a worse financial position. The consent judgment requires the company to stop doing business in Georgia and pay $150,000 in civil penalties.

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How Does a Secured Credit Card Work? | Credit Card News & Advice



Building credit from scratch is often referred to as a chicken-or-the-egg problem. If you don’t have a credit history, it can be challenging to get approved for a credit card. But if you don’t have a credit card, it’s hard to build a credit history.

Here’s where secured credit cards can save the day. It’s possible to be turned down for a secured credit card, but if you’re approved for one, it’s a good way to get started on your journey to great credit.

We’ll start with the basics and work our way up to the advantages – and disadvantages – of secured credit cards.

There are both unsecured and secured credit cards. An unsecured credit card doesn’t require a deposit to get approved for the card. The top unsecured credit cards from major issuers are typically used by those who have at least fair credit. There are some unsecured credit cards available for those with zero or bad credit, but they tend to have high interest rates and fees.

Due to the cost of unsecured cards that target those with little or bad credit, many turn to secured credit cards. Secured credit cards do require a deposit, usually ranging from $200 to several thousand dollars, depending on the deposit requirements of the issuer.

The deposit stays in an account, and the purpose of the deposit is to decrease the risk for the lender. If you don’t pay for the purchases you made with your secured credit card, the financial institution will use your deposit to pay it off.

When you get approved for a secured credit card, you’ll receive a credit card that looks just like an unsecured credit card. There’s no visible clue that the card is secured.

The amount of your security deposit is usually equal to the credit limit for your new secured card. You’ll use your secured credit card just like you would an unsecured card. You can use it for purchases everywhere that accepts your secured credit card.

Just to be clear, your security deposit stays in an account with the issuer. You’ll make payments on your balance from one of your own bank accounts. So, you’re actually buying things on credit.

Most secured credit card issuers report your payment history to the three major credit bureaus: Equifax, TransUnion and Experian. If you can’t find confirmation on the card’s home page that payment history is reported, call the issuer to make sure it’s the policy.

When your secured card’s bill comes, you must pay the bill by the due date. If you pay your balance in full, you’ll avoid paying compound interest. If you consistently make on-time payments and keep low balances on your card during the month, your credit score will begin to increase.

Secured credit cards have many advantages, but there are also downsides to this type of credit card.

  • Secured credit cards help you build credit and develop a good credit score.
  • Secured cards help you learn how credit works. And since the credit limits are on the low side, it helps to minimize your risk of getting into debt.
  • Some credit card issuers will promote you to an unsecured credit card. Not all secured card issuers have unsecured versions, but many of them do.
  • When you’ve built a good credit history and you’re ready to upgrade to an unsecured card, you can get a refund of your deposit.
  • Many secured credit cards offer rewards and benefits.

  • You have to make a security deposit, and this ties up your money for the life of the secured card.
  • Some secured cards have many fees, so you have to read the fine print carefully.
  • You’ll probably have a low credit limit, but this is often a good thing while you’re getting comfortable using credit.
  • Some secured credit card issuers don’t offer unsecured versions, which means you have to apply for an unsecured card from another issuer.

I know it’s difficult to build credit or to come back from a poor credit score. A secured credit card can be a great option, but be sure you read all the disclosure statements and understand if there are fees involved. After about a year of responsible use, you’ll probably have at least a fair FICO score (580-669), which is good enough to make the leap to an unsecured credit card.

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Review: Bank of America® Customized Cash Rewards Credit Card for Students



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Now that most students are starting to return to in-person school, many young adults and their parents are once again looking for the right credit card. Having a credit card offers students a secure and convenient method of payment. It also helps students build credit and even earn some rewards. The Bank of America® Customized Cash Rewards Credit Card for Students excels at all of these tasks.

Key Terms

  • Welcome Bonus: Earn $200 cash rewards after spending $1,000 within 90 days of account opening.
  • Rewards: Earn 3% cash back in the category of your choice including gas, online shopping, dining, travel, drug stores, or home improvement/furnishings. Receive 2% cash back at grocery stores and wholesale clubs and 1% cash back on all other purchases.
  • Annual Fee: None
  • APR: 13.99% to 23.99%
  • Promotional Financing Offer: 15 months of 0% APR on both new purchases and balance transfers.

How This Card Works

This card is a very competitive rewards card, especially for a student card. New applicants earn $200 in cash back after making $1,000 worth of new purchases within 90 days of account opening. You also earn 3% cash back in the category of your choice including gas, online shopping, dining, travel, drug stores, or home improvement/furnishings. Additionally, you earn 2% cash back at grocery stores and wholesale clubs and 1% cash back on all other purchases.

But rewards shouldn’t be the most important thing to students. Instead, consider this card because it’s very easy for Bank of America customers to manage, along with their checking and savings accounts. It also helps students to build their credit by offering them a free FICO score each month. It’s compatible with digital wallet technology and can be managed by a full featured mobile app.

New accounts also receive 15 months of 0% APR financing on both new purchases and balance transfers, and there’s no annual fee for this card.


While most student credit cards are very basic, this one comes with generous rewards, including a new account bonus. Other advantages are its promotional financing offer and free monthly FICO score. There’s no annual fee for this card, but that’s expected with a product designed for students.