Latest Posts
Home > Debt Relief Industry > Business Models > A COMPLIANT DEBT SETTLEMENT MODEL THAT CAN KEEP YOU IN BUSINESS

A COMPLIANT DEBT SETTLEMENT MODEL THAT CAN KEEP YOU IN BUSINESS

I was not going to publish this email but now that I’ve received it from four different people I’m going to post a redacted version of it.

This must have been sent to a large audience since so many are sending it to me.

More attorney model silliness

FTC Final Rule.
A COMPLIANT DEBT SETTLEMENT MODEL THAT CAN KEEP YOU IN BUSINESS:

Dear Clients,

I know many of you are very concerned about the future of debt settlement and are looking for a compliant model.

I have worked closely with the [****] the [****] for [****] for over [****] years and he has a compliant solution so you may continue your business as usual.

Please read the email below from [****] and give him a call and secure your future in the debt settlement industry if you have any interest..

[****],

If you know anyone who is concerned about how they can possibly continue to operate since the FTC final rule, be sure to have them call me. A new company we’ve formed has hooked up with the largest bankruptcy law firm in the country, and is going to be offering debt resolution services on their behalf for the foreseeable future…

As you know, my company [****] has been around for almost [****] years, and we’ve enrolled over [****] consumers into our program. I’ve been on [****] executive board for the last couple years, and serve as its [****]. This new company we’ve formed is taking on only one or two more affiliates, and that’s it! The law firm’s program we’ll be offering gives the consumers full legal representation, and our affiliates will be able to generate substantial revenues in an extremely compliant manner….

If you know anyone who is interested have them call me at [****] and I’ll explain…

Sincerely,

Every time I see one of these emails I’m left wondering why people think it is a good idea to find a loophole to continue a practice that has already been labeled deceptive and abusive?

Are these lawyers so willing to risk their license think the deceptive sales practices will vanish once the sales people start using their name? If they do, it will be a tough lesson to learn.

I have a news feed going already to monitor “disbarred.”

A COMPLIANT DEBT SETTLEMENT MODEL THAT CAN KEEP YOU IN BUSINESS
Get Out of Debt Guy – Twitter, G+, Facebook

I can always use your help. If you have a tip or information you want to share, you can get it to me confidentially if you click here.

A COMPLIANT DEBT SETTLEMENT MODEL THAT CAN KEEP YOU IN BUSINESS by

Share This and Spread the Word

About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Ricky A. Lopez

    Sounds like you guys are one of those bad apples you speak of. Attorney models do not work. There is no exemption!

  • Ricky A. Lopez

    I bet. I can’t wait until everything is ready to go and we turn the wheels. In regards to the DSCPA, I really haven’t been concerned about it. I feel that it will land around 10-15% of savings in the end.

    Yet, if it is passed I would re analyze the business model and see what can be tweaked to make it work (even if I have to reduce my target market).

    However, laws are words and there are ethical and creative ways to get around things in an honest manner (within reason). With debt settlement there is a variety of ways the work done during the enrollment process and initial consultation process can be termed (I will leave it at that for now).

    But, at the end of the day if we perform our service at a fair price, we will have happy clients that do not complain. If none complain, the likely hood of being investigated is minimal.

    Furthermore, I heard of all these NEW ATTORNEY MODELS that will be compliant and still let us charge the same heavy upfront fee’s (JK)… I’m sure that when the FTC or State decides to use it’s resources for the benefit of the General Public and to go after a Non-Compliant Company they will elect to go after those MAGICAL ATTORNEY MODELS rather than our PERFORMANCE BASED MODEL.

    To save the industry from the sharks, we as ethical debt settlement providers, must engage the community, our clients, our employees, and etc to help spread the word to warn others of these Predatory Debt Settlement Companies and make them and others aware of the Performance Based options.

    Without clients, these companies will vanish, which will in turn make regulators :), and help increase our volume to where we can operate a sustainable business at such small margins. If the sharks disappear I’m sure regulators will start to back off.

    That is all for now. Talk to you guys again in a short while with an update on the new performance based model for RALDI Financial.

    P.S. Thanks for the best wishes Andy.

    Best Regards, Ricky A. Lopez

  • J

    I am going to assume this is the one from Nick at Predictive Dollars.

    I, too, have recvd wind of this email from a client.

    I have several problems with it besides all the ones you & your commentors have pointed out.

    1. John Philbin owns and runs a self save Debt Settlement model called Debt Remedy.
    2. This method has cause tremendous harm in the country to many individuals even worse then the typical DS model. The reason is that they don’t even use a Noteworld or GCS. Clients are told what they need to self-save while Debt Remedy takes out all of their monies or fees. Sometimes as much as the first 7 months.

    3. Here are several BBB with god awful ratings and complaints on Debt Remedy:
    http://www.bbb.org/south-east-florida/business-reviews/credit-counseling-and-management-services/debt-remedy-solutions-in-boca-raton-fl-9001507

    http://www.bbb.org/south-east-florida/business-reviews/credit-counseling-and-management-services/debt-remedy-advisors-in-jupiter-fl-92008843

    http://www.bbb.org/south-east-florida/business-reviews/credit-counseling-and-management-services/debt-remedy-advice-in-north-palm-beach-fl-92006235

    4. Debt Remedy is a subject of NY Attorney General inquiries:

    http://getoutofdebt.org/6847/new-york-attorney-general-announces-nationwide-investigation-into-debt-settlement-industry

    You can post this in your comments if you want. It’s amazing how this guy is just going to SLITHER into this “new model”.

    Also, have you ever looked into the background of the CEO of Predictive Dollars, since he’s the intermediary messenger here?

    Oh boy.

    Thanks,

    J

  • alex frias

    working for an attorney based debt resolution company is a different model and there are no upfront fees for consumer but the salesman who got the consumer into the program gets an upfront commission from the firm…Its been a blessing helping so many people get out of debt…I’m sick of banks and their 20% interest rates they put on consumers for no reason…the legit debt settlement companies will switched to attorney backed debt resolution and have a chance to continue success making great money helping people get out of debt!God bless you all!!!

    • http://GetOutOfDebt.org Steve Rhode

      Alex,

      Just to be clear, when you say no up-front fee, do you mean no fee to join the program or no fee at all charged the consumer until they make their settlement payment to the creditor?

      Steve

  • alex frias

    the smart debt settlment companies will get into attorney backed debt resolution field…I work for a debt settlment firm ight now and I am excited for the new changes,it will get the bad apples out and I can still make a great living helping people get out of debt!!!!!

    • http://GetOutOfDebt.org Steve Rhode

      Alex,

      I’m curious, how does an attorney backed debt resolution model differ from the same rules all debt settlement companies will be subject to moving forward?

      Steve

      • http://www.raldifinancial.com Ricky Lopez

        Sounds like a classic Hat trick.

    • David

      Wow! Getting an Attorney backed model won’t make your company imune to the new laws. In fact, if you still charged all the up front fees and your competition didn’t, how do you even plan on competing with that?

      My suggestion is to look for a new line of work my friend. What were you in last, mortgage?

    • http://www.raldifinancial.com Ricky A. Lopez

      Sounds like you guys are one of those bad apples you speak of. Attorney models do not work. There is no exemption!

  • http://www.raldifinancial.com Ricky Lopez

    I think it is hilarious how most of these companies are saying they are going to be compliant and still offer the same program and charge the same fee. I’ve been in the business for 3 years and left because I hate the business model that is out there. After the FTC ruling and the proposed Shummer bill, I’ve noticed an onslaught of companies offering the “next debt relief program” that is fully compliant, allows you to continue to operate the same, and charge the same fees. Really? How’s that? I was hoping the industry would change rather than elude the laws. That is not the case and that is why I am re-entering the industry. I am planning on bringing one of the first truly compliant models to market. I am shooting to introduce it by November 1st. My model will charge no upfront fee. Fee’s for the Debt Settlement Service will be collected only after the settlement took place and our client saved money. Furthermore, our fee will only be 10-15% of the final savings. That’s close to 1/3 of your average debt settlement costs. Plus, our debt settlement service fee will never exceed 10% of the enrolled debt amount. This model will be compliant in all 50 states, adhere to the newly enacted no up front fee charging laws (NOT GET AROUND), charge less than the recommended fee model provided by TASC, and if the Shummer bill ever gets passed the fee model will be complaint there too. It’s time to provide American consumers with a legit debt relief option. The new model will be sold through the RALDI Financial name through the RALDI Debt Support subsidiary.

    • http://GetOutOfDebt.org Steve Rhode

      Rickey,

      Please keep me posted on your journey. If you’d be willing to write an op-ed on your observations and new approach I’d be happy to publish it.

      Steve

      • http://www.raldifinancial.com Ricky Lopez

        I will definitely get that over to you once it’s all together. I appreciate it. Before everything goes live I will be offering 5-10 consumers the ability to join our program for absolutely free. In return we will only be asking for an honest review of what they though about our program, staff, company, and their success in the program for us to publish. I have 2-3 that I will be doing it for, but if you have a couple of people that may be interested please feel free to let me know. It has to be someone that can afford to make a large enough payment to where we will have enough funds to settle at least an account or two relatively quickly. Thanks again, and I appreciate you helping the consumers in seeking an ethical and practical solution.

    • http://www.settleshort.com Andy Faria

      Hey Ricky,

      Performance based debt settlement could be a profitable, rewarding industry. We provide the service on a smaller scale, and I can tell you it’s a lot of fun. We get zero complaints and we’re settling a lot of debt.

      The DSCPA should concern you though, this law if passed would limit fees to 5% of the savings on a particular debt. There is no possible way any DSC could stay afloat only charging 5% of the savings, this would shut down the debt settlement industry.

      The assholes currently in the industry (eg. the author of the above email) should also concern you. If they continue looking for slimy ways to avoid the advance fee ban, the lawmakers will respond by regulating the industry out of existence.

      It sounds like you have good intentions. I hope you find success and have as much fun as we do with a performance based fee model.

      • Dave

        I think someone needs to do a covert call to the author of the above email and find out they way they plan on getting around the law. Would love to find out. Perhaps I will when I get a chance….

      • http://www.settleshort.com Andy Faria

        I still don’t even know who he is.

        If you want to hear some interesting thoughts on how a company plans to get around the rules, call Norton & Assoc.

        I just had to after reading one of Steve’s articles, this call turned my stomach.

      • http://GetOutOfDebt.org Steve Rhode

        I really feel bad for Scott Norton. I’m afraid he’s going to get his ass handed to him and he’s just a brand new lawyer.

        This is the article we are talking about.

        Andy, fill us in on what you heard.

        Steve

      • http://www.settleshort.com Andy Faria

        I have a whole page of notes from this call.

        I posed as an affiliate “looking for a way to survive the advance fee ban”. I spoke with a guy named Ed who claimed to have “owned one of the top DSC’s in the country”. Yeah right.

        From the beginning he was pushing hard that front end affiliates need to “get as many damn clients you can, as fast as you can” (he must have said this 5 times in the 20 mins we spoke)

        He told me that when the ban goes in place they plan to use a network of attorney’s and the only difference will be that “the client will have more interaction with the attorney”. Affiliates would still be able to charge upfront fees but “the days of charging hefty upfront fees will probably be over”

        He also expects that the “law will be challenged” and that his “gut says it won’t all stick”

        Throughout the call I got the sense that this guy just doesn’t care that as of 10/27/2010 they will be breaking the law if they continue to charge advance fees, attorneys or not. He truly believed that this attorney model will still allow them to keep doing the same thing.

        The call ended quickly after I asked, “If you plan on little changing for the attorney model fee structure, then why do you keep telling me I need to get as many clients as I can before October?”

      • http://www.raldifinancial.com Ricky A. Lopez

        I bet. I can’t wait until everything is ready to go and we turn the wheels. In regards to the DSCPA, I really haven’t been concerned about it. I feel that it will land around 10-15% of savings in the end.

        Yet, if it is passed I would re analyze the business model and see what can be tweaked to make it work (even if I have to reduce my target market).

        However, laws are words and there are ethical and creative ways to get around things in an honest manner (within reason). With debt settlement there is a variety of ways the work done during the enrollment process and initial consultation process can be termed (I will leave it at that for now).

        But, at the end of the day if we perform our service at a fair price, we will have happy clients that do not complain. If none complain, the likely hood of being investigated is minimal.

        Furthermore, I heard of all these NEW ATTORNEY MODELS that will be compliant and still let us charge the same heavy upfront fee’s (JK)… I’m sure that when the FTC or State decides to use it’s resources for the benefit of the General Public and to go after a Non-Compliant Company they will elect to go after those MAGICAL ATTORNEY MODELS rather than our PERFORMANCE BASED MODEL.

        To save the industry from the sharks, we as ethical debt settlement providers, must engage the community, our clients, our employees, and etc to help spread the word to warn others of these Predatory Debt Settlement Companies and make them and others aware of the Performance Based options.

        Without clients, these companies will vanish, which will in turn make regulators :), and help increase our volume to where we can operate a sustainable business at such small margins. If the sharks disappear I’m sure regulators will start to back off.

        That is all for now. Talk to you guys again in a short while with an update on the new performance based model for RALDI Financial.

        P.S. Thanks for the best wishes Andy.

        Best Regards, Ricky A. Lopez

  • Dave

    The big question I have is how do these companies trying to exploit a loop hole plan to compete with other companies that ARE compliant? If I were a consumer shopping around for this service (as most average consumers do it seems), I would certainly go with a company that WAS compliant and only charged me for a job well done. Not the other way around. In fact, I would think the companies that ARE compliant will market that they ARE compliant and really put a hurting on the non-compliant ‘pay me first’ companies business.

    Seems like they are just putting off the inevitable to me and trying to make as much money for as long as they can.

    • http://GetOutOfDebt.org Steve Rhode

      It’s not a well thought out strategy and a smart compliant company will gladly point out the facts and make the lawyers fronting such an operation look shady, this will lead to online complaints by consumers that will feel ripped off and eventually hurt the lawyers reputation.

      On top of that, how about the companies that will join in to fund lawsuits to challenge the FTC rules, I wonder how the public will view them after they fund a lawsuit to continue deceptive and abusive consumer practices? Smart complaint companies will use that information also to differentiate themselves.

      Steve

      • Dave

        Why would ANYONE want to pay fees up front when they wont have to? Makes zero sense why companies are trying to get around this. They are just gonna get killed in this market.

        I just dont really see this industry as a whole around much longer with the sucess rates the way they are to begin with. Tough racket to be in for sure!

Get My FREE Get Out of Debt Guy Newsletter

It is the smart thing to do.

I promise to keep your email safe and secure.

Close

I want to keep you posted each weekday with just one email about the latest get out of debt news, scam alerts and information to beat back debt.

You can unsubscribe at any time with just one click.

After you subscribe, check your email to confirm your subscription. If the confirmation email does not appear in your inbox in a few minutes, check your spam folder for it. Sometimes it likes to annoyingly hide there.


  • It will keep you posted on the latest scams.
  • You will be alerted to the latest articles.
  • You will wind up smarter than everyone else dealing with debt.