Phony Debt Relief Claims

: Chris Lee Law Firm

  Filed under: Debt settlement

Many of those experiencing overwhelming debt burdens reach a point of desperation. Worried about credit scores, asset liquidation and wage garnishment, many people are scared into making big decisions about their debt. For some, these decisions came without proper investigation; leading them into the office a phony debt relief company.

FTC Warnings

Just this week, the Federal Trade commission has charged an Ohio-based company for making fraudulent debt relief claims. Operating over 17 websites offering false claims of debt relief services, this company has been shut down and ordered to pay hundreds of dollars in restitution. Cases like this go on every single day, as the FTC works to protect consumers and put an end to predatory service providers.

Some of the more recent claims being made by this, and other phony companies, are:

  • “Once creditors agree to make a deal, you can get out of debt from 12 to 36 months.”
  • “The U.S. government decided to introduce a stimulus package to boost the financial institutions and prevent them from breaking down.  Part of this stimulus money is being utilized by the credit card companies to offer debt settlements to the users.”
  • Debt settlement companies “can take all of your outstanding debt and not only eliminate at least 50% of it but also provide a realistic repayment plan for the rest of your debt.”
  • “If you play your cards right, your debt problems will vanish before the first year ends.”

Other signs of a potentially fraudulent debt relief service are:

  • Making guarantees to settle debts for “pennies on the dollar”
  • Requiring debt payments be made through their company or asking for access to the debtor’s financial accounts.
  • Requiring debtors to pay up-front fees for their services.
  • Lack of proof of accreditation or unable to be verified by the Better Business Bureau.

 


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