You may have seen their commercials or the print advertisements for their debt settlement offers; but what you probably didn’t realize is that they aren’t offering any services at all but are instead selling the private information of desperate debtors to other so-called debt settlement companies, some of which were possible scammers.
In a nationwide ad campaign that featured phony testimonials from people posing as customers, the defendants used statements such as, “We’re 800 Credit Card Debt, America’s leader in helping settle debt . . . [W]e have programs available to help you eliminate your debt by up to 60%.”
The complaint also said the defendants lied about providing the advertised debt settlement services. In some cases, they also claimed their services were part of a public, non-commercial program, through widely televised statements such as this one:
“The following is a public announcement … Americans who are behind on their credit card payments must take action immediately. If YOU have ten thousand dollars or more in credit card debt, a new relief program is now available …” In fact, those claims were false, no debt settlement services whatsoever were provided, according to the FTC’s complaint. Instead, the defendants sold the sales leads generated by their ads to debt-settlement providers, or to other lead generators or lead brokers that re-sold them.
The FTC has since cracked down on this fake company and banned them from doing business in the financial sector. But how many debtors have already fallen into their trap and given up their private information only to have it sold to third-parties? How many Americans have responded to these ads thinking that one call would stop creditor calls and slash their credit card debt by fifty percent or more? So-called debt settlement companies do not have the power to stop creditors nor do they have the power to force a creditor to stop calling you. Only bankruptcy, through the power of the automatic stay can stop creditor calls, lawsuits and garnishments. For debtors who are so far behind on their bills that they feel compelled to called companies such as the debt settlement firm now banned from business, calling a bankruptcy attorney might be a wiser decision.
