Financial Regulator Files Complaints Against Lead Aggregators

Financial Regulator Files Complaints Against Lead Aggregators
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December 21, 2015

The Consumer Financial Protection Bureau (CFPB) is suing a company and an individual for allegedly exposing millions of consumers to harassment and deceit.

The agency alleges that T3Leads bought and sold personal information from payday and installment loan applications without properly vetting buyers and sellers. In a separate filing, the CFPB took action against Eric Sancho, operator of Lead Publisher, which sold leads to fraudulent debt collections without regard for how they would use the data.

The CFPB is looking for monetary relief for those harmed by T3Leads and for the business to clean up its practices. The agency is ordering Sancho to disgorge about $21,150 he made illegally and banned him from the financial products and consumer leads industry.

Owned by Grigor and Marina Demirchyan, T3Leads is a lead aggregator, which buys consumer information from lead generators, websites that market payday and installment loans. Sancho's Lead Publisher also bought and sold leads, which contain personal information such as consumers' names, telephone numbers, home and email addresses, references and employer information. Lead Publisher is now out of business.

The CFPB alleges that T3Leads bought leads and sold them to payday or installment lenders and others with no regard for how the consumers' information would be used or to the promises lead generators made to consumers. Buyers of leads from T3Leads include lenders tied to Indian tribes or based in foreign jurisdictions. These lenders often skirt state laws and deny the jurisdiction of U.S. courts.

The CFPB alleges that T3Leads did not vet or monitor its lead buyers, exploited consumers' lack of understanding of the risks, costs, and conditions of the loans applied for, and put consumer information at risk of being trafficked for illegal purposes.

The CFPB found that from 2011 to 2014, Lead Publisher's Sancho failed to vet his leads' sources or buyers. He sold roughly three million leads to two related companies that used the information to harass and deceive consumers into paying alleged debts they did not actually owe.

For more information about each complaint, visit the CFPB website.