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Class Action Suit by Debt Settlement Employees Started at Credit Solutions of America

Recently I’ve written about class action lawsuits by debt settlement company employees against their employers for wage issues. The following companies, SO FAR, have been involved in this; ABC Debt Relief, The Debt Answer, Lloyd Ward & Associates, Debt RX USA, Silverleaf Debt Solutions.

From what I have been able to find it looks like the beginning of this trend was a class action lawsuit filed by Teresa Willins and Joi Broadnax against CSA – Credit Solutions of America. I didn’t find this suit until a debt settlement employee in Dallas told me they have been contacted by lawyers to join in the suit.

As of August 2, 2010 there were 61 employees involved in the suit against Credit Solutions of America. – Source

What makes the CSA suit interesting is that parts of it are identical to what has been included in other suits. That is except for the “cup of noodles” section and the debt settlement sales person nap room. Rest up, sell, sell, sell.

Debt consultants were required to work a minimum of 12 hours per day, but were expected to work as many hours as necessary to reach assigned sales goals. Debt consultants regularly worked 14-16 hours a day and CSA provided debt consultants a room to nap and sleep when necessary to reach company goals.

Debt consultants were not provided a rest or lunch break, but instead, CSA served debt consultants “cup of noodles” for lunch so they would not have to leave their desk and could continuing selling the debt settlement services.

Here is more information and allegations from the suit 3:09-cv-01025-M.

  • CSA is a for-profit fmancial service company primarily marketing and providing debt settlement plans to the public.
  • For at least three years prior to filing of this complaint and continuing (hereinafter “Liability Period”), CSA had a policy and practice of not correctly compensating its debt consultants for work performed for the benefit of CSA over and above forty (40) hours per week, to wit: virtually all debt consultants received a $2,000 forgivable draw their first 90 days of employment and a non forgivable draw of $2,000 per month thereafter. Debt consultants qualified debtors for debt settlement plans of Defendant by verifying the debtor possessed at least $10,000 in debt. Next debt consultants analyzed each creditor comprising the $10,000 is owed at least $600 and there are contracts in place between the creditor and CSA. The debt consultant sets up a CSA account for each creditor. Lastly, the debt consultant verified the debtor’s bank accounts and assisted the debtor in picking a payment plan. Once a plan was chosen the debt consultant, using CSA guidelines, would set up a monthly draft on the debtor’s bank account whereby CSA would obtain its fee and moneys to satisfy the debtor’s creditors. Eighty-five percent (85%) of CSA’s fee is collected from debtors’ accounts within the first 90 days. Debt consultants received a fee from the first monthly draft which was a percentage determined on the total volume of draft’s occurring monthly attributable to that debt consultant.
  • Debt consultants were required to work a minimum of 12 hours per day, but were expected to work as many hours as necessary to reach assigned sales goals. Debt consultants regularly worked 14-16 hours a day and CSA provided debt consultants a room to nap and sleep when necessary to reach company goals.
  • Debt consultants were not provided a rest or lunch break, but instead, CSA served debt consultants “cup of noodles” for lunch so they would not have to leave their desk and could continuing selling the debt settlement services.
  • Debt consultants worked six (6) days a week.
  • As stated above, debt consultants do not receive overtime for hours worked over 40 in any week.
  • CSA’s revised compensation/bonus plan containing an overtime component does not correctly calculate debt consultants’ regular rate of pay for purposes of calculating overtime; i.e. commissions paid on top of consultants’ hourly rate are not included in their regular rate of pay. – Source

The suit was filed by:

The Cochran Firm – Dallas
BRYAN POPE, SBN: 00788213
3811 Turtle Creek Blvd
Turtle Creek Centre, Suite 1400
Dallas, TX 75219
(214) 651-4260-Phone
(214) 651-4261 -Facsimile
[email protected]

Class Action Suit by Debt Settlement Employees Started at Credit Solutions of America
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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.
  • class-action-suits

    i want more information on debt claims… where should i look??

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