Operator of $46m student loan scam hit with lifetime FTC ban
A Nevada-based debt relief operator received a lifetime industry ban and a $46 million judgment from the FTC, highlighting the massive fraud risk emerging as 9.5 million US student loan borrowers fall into default.
The Federal Trade Commission has banned Dennise Merdjanian, the operator of Nevada-based Superior Servicing, from the debt relief and telemarketing industries for life following a $45.9 million judgment. The settlement, announced Tuesday, concludes the agency's litigation against a scheme that allegedly cheated student loan borrowers out of roughly $46 million.
The regulatory action centers on allegations that Merdjanian impersonated Department of Education employees to extract illegal upfront fees from distressed borrowers. She and her co-defendants falsely promised victims lower monthly payments or complete loan forgiveness, providing debt relief services that either did not exist or were never delivered.
While the FTC imposed a monetary judgment exceeding $45.9 million, the penalty is partially suspended due to Merdjanian's inability to pay. The agency retained a clawback provision, meaning the full sum will immediately become due if she is later found to have misrepresented her financial condition.
Systemic default risk
The resolution closes out a case the FTC initially filed in November 2024, at which point a federal court froze the scheme’s assets and halted its operations. An amended complaint in early 2025 added co-defendants Eric Caldwell and David Hernandez, who were permanently banned from the debt relief sector by a Nevada federal court in September 2025.
For market participants and consumer finance executives, the case highlights a worsening systemic risk in the US student loan market. When the pandemic-era payment pause fully expired in late 2024, the number of borrowers in default—defined as over nine months behind on payments—surged from 5.3 million to 9.5 million. This means roughly one in five federal student loan borrowers is currently in default.
This rapidly expanding pool of distressed consumers has created a massive target for bad actors. Debt relief scams are estimated to steal approximately $5 billion from Americans every year. The FTC has actively targeted this space, settling cases that account for roughly $60 million in stolen funds since May of last year. The Superior Servicing judgment indicates that federal regulators will continue to aggressively pursue and dismantle fraudulent operators exploiting the post-pause default crisis.
