Howard S. Dvorkin, a well-known advocate in the consumer debt relief industry, is under investigation by federal authorities in Washington, D.C. and Montana for business ties to payday lenders, a person familiar with the probe told The Wall Street Journal.
The investigation is at an early stage and possibly won’t lead to any criminal or civil charges. The person familiar with the investigation said some recent federal payday-lending cases have alleged racketeering or mail or wire fraud.
Dvorkin is the founder and former president of Consolidated Credit Counseling Services Inc., a nonprofit that says it has helped more than five million Americans get their borrowing under control. But Dvorkin also has held interests in businesses that provide services to payday lenders, according to the Wall Street Journal. One of those firms said in 2009 that it was offering payday loans. That lender’s website said it charged annual percentage rates between 235% and 782% on 14-day loans. Its site in 2012 said it was still offering payday loans.
His attorney, Thomas Katz in Boca Raton, Fla., told the newspaper his client hadn’t been contacted by investigators and that he’s confident there’s no basis for a prosecutor to be involved. Dvorkin late last year said he wasn’t in the payday loan business and, when told of documents indicating firms in which he owns interests either had offered payday loans or supplied services to payday lenders, he said he didn’t control those firms and wasn’t familiar with their daily operations.