Migrants cheated; firm must pay $811M
A Virginia company that posts bonds for jailed immigrants facing deportation has been ordered to pay more than $800 million in restitution and penalties for fraudulent practices such as getting Spanish-speaking clients to sign English-language contracts that they didn’t fully understand and requiring them to pay $420 a month for GPS ankle monitors.
The company, Libre by Nexus, based in Virginia’s Shenandoah Valley, also threatened legal action against clients who didn’t pay the company’s fees, saying that their accounts would be sold to collection agencies and that they would be referred for deportation, according to the federal Consumer Financial Protection Bureau and the attorneys general of Massachusetts, New York and Virginia.
In a ruling Monday, U.S. District Judge Elizabeth Dillon in Roanoke ordered the company and its principals to pay more than $811 million. The judge found that the company owed the consumer protection bureau $231 million in restitution, of which Virginia is seeking $14 million, Massachusetts $3.3 million and New York $13.7 million to reimburse the company’s clients. The rest is owed in civil penalties, including more than $555 million to the consumer protection bureau, according to court documents.
Legal experts said the company could face bankruptcy, considering the whopping size of the monetary judgments. Libre Chief Executive Mike Donovan blasted the judge’s “offensive” ruling and said the company would appeal.
“We continue to remain committed to serving our clients — people who suffer and sacrifice for a better life, and who do not deserve to be political pawns in an American legislature or an American courtroom,” Donovan said in a statement.
A spokeswoman for the consumer protection bureau declined to comment Monday. The Virginia attorney general’s office did not respond to a request for comment.
Migrants in the custody of U.S. Immigration and Customs Enforcement who are facing deportation are allowed to post bond while they await court hearings if they are not considered a flight risk or a threat to public safety. The median bond was $7,500 in 2018, according to the consumer protection bureau and attorneys general.
A 2017 investigation by The Washington Post found that some clients of Libre, which means “free” in Spanish, were given documents in English that they didn’t understand and told to sign them. Several told The Post they were startled to have GPS monitors the size of cigarette packs strapped to their legs, and could not afford the $420 monthly fee the company charged. The GPS devices often did not work, according to court records. The company has faced a raft of federal and state investigations in recent years.
Beside ruling that the company owed $231 million in restitution, Dillion ordered Libre to pay $3.4 million to Massachusetts, $13.9 million to New York and $7.1 million to Virginia in civil penalties. In addition, the judge ordered each of the five defendants — Libre; its parent company, Nexus Services; Donovan; and his associates, Richard Moore and Evan Ajin — to pay $111 million in civil penalties to the consumer protection bureau within 10 days.
The judge also barred the company from requiring clients to wear GPS monitors.
A federal trial had been scheduled for early 2023 in the Western District of Virginia. But it was canceled after Libre did not fully comply with its obligation to turn over evidence, and the judge moved directly to the sanctions phase of the case.