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Primerica to Sell Debt Settlement for Freedom Financial Network. This is Going to Get Messy.

Well it’s official. Primerica representatives are going to start promoting debt settlement for Freedom Financial network. The first public information on this was sent in by a reader.

The Facebook announcement says:

Imagine how it would feel to not worry about debt. Primerica is pleased to make Freedom Financial Network available to help you determine your best debt relief option and be debt free! – Source

Hopefully the Primerica representatives have been given some comprehensive training about their liability and what they can’t say under the FTC TSRs.

It’s a good thing that Primerica describes themselves as a company that helps people that have to “settle for less.” – Source. Well I guess they are now.

And here we go. My prediction is this is going to get messy with all those inexperienced debt relief sales reps out there in this multi-level marketing company selling debt help.

Primerica is described as a multi-level marketing company which sells financial products and services using a hybrid model of direct selling, franchising and distribution.

Headquartered in unincorporated Gwinnett County, Georgia, Primerica spun off from its former parent company Citi through an initial public offering on April 1, 2010. It is a financial services marketing organization in North America with approximately 90,000 independent representatives, including 22,000 Financial Industry Regulatory Authority (FINRA) Series 6 licensed through Primerica’s securities broker-dealer affiliate PFS Investments, Inc. in the United States, and through PFSL Investments Canada Ltd. in Canada. The company focuses on the sale of term life insurance, as well as providing other financial products and services including mutual funds, annuities, segregated funds, managed accounts, long-term care insurance, pre-paid legal services, auto insurance, home insurance, credit monitoring and debt management plans. The company has more than 4.3 million life insurance clients and over 2 million client investment accounts. – Source

Primerica conducts business principally in the United States, Canada and Puerto Rico.

Primerica to Sell Debt Settlement for Freedom Financial Network. This is Going to Get Messy.
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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.
  • http://GetOutOfDebt.org Steve Rhode

    I wonder if the Primerica reps got the memo on Colorado? http://getoutofdebt.org/53046/freedom-debt-relief-out-of-colorado

  • Victor

    Hi Steve, I must correct you on your reporting of Primerica and Debt Settlement article you wrote, First of all We do not describe ourselves as a company that helps people “settle for less” our mission statement is “Help families become properly protected, debt free and financially independent” that is much more that any other financial services company is doing for the consumer nowadays, secondly as representatives we do not have to get involved in the process of debt settlement we simply are referring agents Freedom Financial is our partner in helping the client through the process, I strongly suggest you do due diligence before writing an article that provides misinformation and post it as a factual research, no research was done before this article was posted, therefore it makes you look as simply another charlatan online.

    • http://DamonDay.com/ Damon Day

      Steve is a charlatan? Why? For telling consumers to take a step back and review all options before making a decision? For daring to raise the question that a commissioned sales rep from Primerica might not be the best source of unbiased information about dealing with debt?

      Ya, that sounds so shady.

      Tell me, what does “simply a referring agent” mean and what kind of confidence should your clients have with your recommendations since you are just a referring agent?

    • http://GetOutOfDebt.org Steve Rhode

      Victor,

      On the “settle for less” statement, did you not click on the source link that shows where that comment came from at Primerica and the context? I don’t mind you being critical of something I’ve said but seriously, when the documentation is right there it seems you didn’t bother to click and do your research.

      If your mission is to help families then why would debt settlement be part of that strategy? The math clearly shows that those who would qualify for a chapter 7 bankruptcy and get back to saving in 90 days rather than enter a five year program will be better off financially in the long run. Do you do any real assessment or do you just hear keywords and refer for commissions?

      It is a bit surprising that it appears you are calling yourself a financial services company representative and yet you are not aware of what the people you refer are being sold. And you accuse me of not doing due diligence?

      What in the article above is incorrect or wrong? And as far the the title goes, I think you just proved my point.

  • David Christian

    Exactly all Primerica reps does is refer clients to Freedom Financial. Primerica reps have nothing to do with the process of the debt settlement program. All the do is refer clients to FFN

    • http://GetOutOfDebt.org Steve Rhode

      And you think that protects you and keeps you out of the line of fire in the debt world?

  • http://GetOutOfDebt.org Steve Rhode

    Just an FYI. Freedom Financial Network settlement over fees is about $2 million dollars. Consumer refunds coming. I wonder if that will result in Primerica charge backs? See http://getoutofdebt.org/46944/freedom-financial-network-freedom-debt-relief-to-refund-almost-all-clients-under-settlement

  • http://GetOutOfDebt.org Steve Rhode

    Just today this tweet from a Primerica rep was sent out:

    “IF YOU NEED HELP to get Out of Debt, Allow me to assist you. Contact me by InBox or 512-348-6099; Si usted…http://fb.me/OmBBFFAJ 

    It led to a video from Primerica that certainly appears that representatives are going to be treading some pretty dangerous water with the issue of providing advice and substantial assistance in the crusade to eliminate debt.

    Some quotes from the video:

    “Nobody is really helping middle class people and middle class people are abandoning their debt.”

    “Once you miss one payment the banks are going to send the dogs out after you.”

    “Primerica has the answers. We will revolutionize Main Streets ability to reduce debt and achieve financial freedom.”

    “Primerica can put Main Street America on the path back to debt freedom.”

    “American’s need protection protection, they need help from someone a company that is willing to stand by them and I can’t think of another company better than Primerica.”

    “No company knows how to crusade for families like Primerica does and we’re going to be going to families crusading to help them to take control and get out of debt.”

    http://www.youtube.com/watch?v=n_XUO9I2al4

    • http://DamonDay.com/ Damon Day

      Crusading for Consumers? 

      Wow, I kept waiting for someone to jump out at the end and say “Live From New York, It’s Saturday Night”

  • dave

    “Okay, if you understand my concern then why are you talking about “illegal?” You still don’t have a clue, do you.”
    Well, you are the one assuming it is illegal. I highly doubt that.PRI & FFN teamed up to rip off the world. FFN has been in this industry for about a decade! If what FFN was illegal the FTC wouod have shut them down. That is not the case.

    • http://GetOutOfDebt.org Steve Rhode

      You are the only one saying anything is illegal.

    • Charles Phelan

      Dave, would you please enlighten us on how Primerica reps will be compensated for referring potential clients to FFN? We keep hearing that PRI reps will not be selling the service. Are you saying you’re doing this for free? You will not receive any monetary compensation for such referrals?

  • dave

    Steve,
    I also read your link to what we should know! Sounds like primerica and FFN are a couple of steps ahead of you! You are aware that FFN is licensed in every state except for a couple. Currently the service is only offered in a few states. I think you believe we the agents are selling the actual solution. We are not! It is strictly a referral service!

    • http://GetOutOfDebt.org Steve Rhode

      Dave,

      I understand all of that. It is you that does not understand. I’m trying to point out the liabilities of referrals in the debt relief space.

      The original point of the post was that Primerica reps are not going to have a clue what they are getting in to in the debt relief space. If you are a Primerica representative you are the shining example of that.

  • dave

    How is this going to get messy? The author only states that because he doesn’t understand it. Which part of the “referral program” didn’t he understand. Primerica agents don’t manage or advise on how to settle debt. They just refer them! That is it. They have have to qualify and meet certain guidelines! However, FFN will determine that part!

    • http://GetOutOfDebt.org Steve Rhode

      Are you familiar with the FTC rules regarding debt relief substantial assistance?

      “Not involved in the industry? Not so fast. Even if you don’t directly sell debt relief services, you still may have legal obligations. The TSR has always held telemarketers liable for violations of the Rule. In addition, the TSR makes it illegal to provide “substantial assistance” to another company if you know they’re violating the Rule or if you remain deliberately ignorant of their actions. What amounts to substantial assistance depends on the facts, but some examples could include obtaining and selling leads or helping a debt relief company with its back-room operations by reviewing customer files, processing payments, or contacting customers’ creditors once they’ve signed up. If you work with debt relief companies in any capacity, it’s wise to review their policies and operations to make sure they’re complying with the Rule. Willful ignorance isn’t a defense.” – http://business.ftc.gov/documents/debt-relief-services-your-company-complying-rules

      And if you say it does not apply to you as a Primerica rep, let’s roll with that.

      • dave

        Assuming the rule does apply. Primerica or the agent doesn’t collect an upfront fee. That is a given. It is .a rule that was nforced in the past. If memory serves me correct, a fee can’t be charged until the debt is resolved. Primerica agents & FNN will NEVER review the clients info with each other. Do you honestly think that primerica will go into bed with a company with bad track record? Looks like they are compliant, Steve.

      • Guest

        “Do you honestly think that primerica will go into bed with a company with bad track record?”

        And the track record of FNN is??

      • dave

        Does it matter to you? You are just going to bash FFN. So in honesty a track record to you means nothing!

      • Guest

        I think the point was a track record means everything. And I will ask again…
        And the Track Record of FFN is????

      • http://GetOutOfDebt.org Steve Rhode

        I think you’ve missed the point here. The issue is there are ramifications to being involved in the debt relief world that you are not aware of. Everything I’ve said here has been intended to make you aware of the risks and liabilities. Not attack FFN.

        If you choose to disregard the advice, you do so at your own risk.

        The rule has nothing to do with collecting fees or when fees are collected. Nor does it have anything to do with sharing information about the client.

        I’m concerned that your inexperience in this area is screaming when you say “Do you honestly think that primerica will go into bed with a company with bad track record?” It simply supports my original statement “And here we go. My prediction is this is going to get messy with all those inexperienced debt relief sales reps out there in this multi-level marketing company selling debt help.” The issue here is not about Primerica but about the individual rep exposure.

      • dave

        Steve,

        I understand your concern, but agents are not selling debt relief solution.they simple refer people to FFN. So what you are saying thy refering someone to FFN is illegal?

      • http://GetOutOfDebt.org Steve Rhode

        Okay, if you understand my concern then why are you talking about “illegal?” You still don’t have a clue, do you.

  • Doubt it

    They began in 1977 as A.L. Williams…and breaking away from CITI 2 years ago was the best decision they ever made. They have a high BBB rating than Walmart with an a+…are publically traded on the NYSE (PRI). Don’t knock it till you have tried it. BTW…Look at the military or any other fortune 500 company…what does there businss look like when written out…mmmmm.

  • Charles

    What seems to be missing from this discussion is any indication of how Primerica reps will be compensated for referring business to FFN. Front-end referral fee? A portion of savings only after settlements are accomplished? 

    • http://GetOutOfDebt.org Steve Rhode

      Good question. They must be getting paid some commission for the referral.

      • http://DamonDay.com/ Damon Day

        at some point I think FFN made an announcement that they were going to still pay sales reps up front. Basically fronting the money. Wonder what the claw back provision is on that baby.

      • Andy Fom

        Damon, are you referring to “sales reps” as outside companies who refer? Or individual employees? 

      • http://DamonDay.com/ Damon Day

        I am not sure Andy. I don’t recall the details of the press release. I just remembered something about FFN making an announcement that they were going to front the money to sales reps. I don’t know the details of the proposed payout structure.

  • Jsnelsonassociates

    Probably should do a little more research before posting a misleading column.  Primerica reps will not be giving anyone advise on debt settlement.  All Primerica did was add a vendor to offer an additional service to clients who may have a serious debt or tax problem.  The only thing Primerica reps will be doing is referring the client to FFN.  The client will call FFN and deal directly and only with FFN licensed representatives.  If there is an issue with FFN’s track record that is fine but you insinuate that Primerica reps are not going to be trained properly and that they may not be compliant with various laws which is obviously false.  Of course reps will go through training to learn who this service may apply to and what the process is for calling FFN as well as how to be completely compliant with all laws.

    • http://GetOutOfDebt.org Steve Rhode

      Can you please share with us the training you had on liability for substantial assistance in debt products.

      • Jsnelsonassociates

        In person group training with Primerica and FFN staff. Also video training and online courses that must be completed.  As I mentioned previously the training is specifically geared towards following all laws and regulations for each state and agencies that monitor like the FTC.  Primerica reps are only allowed to get clients on the phone with FFN or refer them to call FFN.  We are prohibited from giving advise or recommendations as to what a client should do.  Only FFN can do that since they are licensed, registered, and bonded. I don’t have the time or want to line item detail all of our training and compliance.  You could have contacted Primerica or FFN if you really believe consumer rights are being violated and laws broken or will be as you predict.  I’m pretty sure a multi-billion $ company is not going to leave compliance issues to chance.    Not to say there won’t be hiccups or a few bad reps, you get that with any large company but it will be far from “messy”  

      • http://GetOutOfDebt.org Steve Rhode

        Didn’t really answer my question but I stand by my initial prediction that it will get messy.

        If you look at my two posts they are not alarmist but give Primerica representatives a basic framework on what they need to avoid doing. See http://getoutofdebt.org/43874/are-primerica-representatives-skilled-enough-knowledgeable-enough-properly-sell-debt-help

        But then again you claim you’ve already had all the training so why bother looking.

        How are Primercia representatives compensated for this help?

  • RobertH

    Is this even really happening? You created this post based only on a Facebook comment of one individual Primerica rep out of over 90,000 Primerica reps, geez. I cannot find anything official from either company confirming this.
    Good thing you’re here to protect us all from these guys.

    • http://GetOutOfDebt.org Steve Rhode

      According to multiple sources and tweets by Primerica reps, it is.

      • RobertH

        Steve/Damon I guess it is harder for you to find a battle to fight these days but looking for troubles with this situation before it is even clear how this will be structured is pathetic. Both Primerica and Freedom Financial Network are excellent and responsible companies with structured training protocals for their staff should they not be given the respect they deserve. Let them launch the program before you attack.

      • http://DamonDay.com/ Damon Day

        True, simply because many of the snakes have slithered away, now that it is harder to ruin peoples lives. I do take issue with your premise. In what context are you using the word responsible?

      • RobertH

        Just saying why don’t you wait until you can see a problem to expose before attacking. I think that is “responsible”.

      • http://DamonDay.com/ Damon Day

        Ok, I see a problem :-)

      • http://GetOutOfDebt.org Steve Rhode

        Apparently you are familiar with the Primerica training offered then to reps. What did it cover?

        What was my attack? I did make a prediction in the post but that’s not an attack, just an observation on sales efforts of past days.

      • Excellent & Responsible

        Not sure I would used excellent and responsible

        Washington – Freedom Debt Relief must refund Washington
        consumers for all fees paid in connection with debts that weren’t settled or
        aren’t in active negotiation programs — those fees add up to $742,613 or more

         

        Colorado
        - Eleven Companies Settle with the State Under New Debt-Management And Credit
        Counseling Regulations

        Freedom Debt Relief, LLC, dba Freedom Debt, Freedom Debt
        Help, Freedom Debt Reduction, Freedom Debt Relief USA, Freedom Financial
        Network and Debt Resolution Partners, a California
        debt settlement company, refunded $509,582 to 558 Colorado consumers and paid $109,500 in
        investigation costs and penalties. It failed to comply with the law’s
        provisions on cancellation rights, cautionary disclosures and advertising, and
        was not registered when it contracted with Colorado consumers. It is registered as of
        Feb. 3,    
        Delaware – The Delaware
        Department of Justice announced today that a California
        debt management services company will pay $153,000 in restitution to 105 Delaware consumers with whom it conducted business
        without complying with Delaware’s
        debt management services statute. Freedom Debt Relief, LLC (“FDR”) had been
        providing debt management services in Delaware
        without first completing the licensing process required by the 2007 Uniform
        Debt Management Services Act. FDR, which is now licensed in Delaware, will also pay $10,000 to the
        Attorney General’s Consumer Protection Unit to cover its enforcement costs

         
        California – THE PEOPLE OF
        THE STATE OF CALIFORNIA,
        V

        FREEDOM DEBT RELIEF, LLC, a Delaware Limited Liability
        Company; FREEDOM DEBT RELIEF, INC. a California Corporation; FREEDOM FINANCIAL
        NETWORK, LLC, a Delaware Limited Liability Company dbas FREEDOM DEBT RELIEF,
        FREEDOM DEBT HELP, FDR; FREEDOM MORTGAGE; ALIVIO MORTGAGE, LLC, a Delaware
        Limited Liability Company; ALIVIO HOLDINGS, LLC, a Delaware Limited
        LiabilityCompany; BILLS.COM, INC., a Delaware Corporation; BILLS.COM, LLC, a
        Delaware Limited Liability Company dba BILLS.COM; FREEDOM TAX RELIEF, LLC, a
        Delaware Limited Liability Company; ANDREW HOUSSER, an individual, BRAD STROH,
        an individual, and DOES 1 through 25, inclusive  

         

        New York
        – Attorney General Eric T. Schneiderman today announced a major settlement that
        will refund money to more than 5,000 New Yorkers across the state who were
        defrauded by a deceptive and harmful debt settlement company. Freedom Debt
        Relief, one of the country’s largest debt settlement companies, misled
        debt-saddled consumers about the amount of money they would save and the
        services it would provide, while reaping large profits in up-front fees. As
        part of the settlement, Freedom Debt Relief will pay $1.1 million to refund
        former customers, offer current customers hundreds of thousands of dollars in
        refunds if they withdraw from the program, and pay $100,000 in penalties to the
        state.  

         

        Idaho – Idaho Code 26 -2227. The Director of the
        Department of Finance concluded that Freedom Debt Reliefs conduct and business
        practices are evidence by the foregoing facts demonstrate a lack of fitness to
        engage in business activities authorized for a licensee.  FDR’s application for a debt/credit counselor
        license was denied.

         

        Illinois
        - DEFAULT JUDGMENT

        Default having been entered against defendant, Freedom Debt
        Relief, LLC, on January

        14, 2011, for failure to answer or to otherwise respond to
        the complaint, IT IS ORDERED that plaintiff’s Motion for Default Judgment is
        GRANTED. Pursuant to 11 U.S.C. § 548(a)(1)(B), judgment is entered against the
        defendant and in favor of the plaintiff in the amount of $5,724.00 plus costs
        in the amount of $250.00

  • Rustyperkins

    Having taken the training the Primerica is requireing all agents to take before participating in this program, I doubt there will be many of the problems that you seem to be predicting.

    • http://DamonDay.com/ Damon Day

      Oh, there is going to be sales training? In that case I would like to make a prediction as well.

      http://www.youtube.com/watch?v=F54rqDh2mWA

      Whos got odds?

    • http://GetOutOfDebt.org Steve Rhode

      Tell us about the training you got on the different debt relief options and the pros and cons. Do you have any training material you can share to show us?

      • Klohee

        if you contact a primerica rep they would be happy to show u.

      • http://GetOutOfDebt.org Steve Rhode

        Show you?

  • http://DamonDay.com/ Damon Day

    Oh the humanity :-)

    • http://DamonDay.com/ Damon Day

      And so it begins…

      I had a consultation with a consumer last week who shared that he spoke with a Primerica rep who recommended Freedom Debt Relief. 

      The one question I have for Primerica reps is…

      How much is your reputation worth?

      If your reputation is worth more than the referral fee, you may want to seriously consider the following.

      Client comes to you for some form of financial advice. You help them and a bond of trust is formed. Then at some point you learn they have debt and refer them to Freedom. The sales rep for Freedom pitches a program that might not make any sense for their situation, yet the consumer doesn’t know that and signs up anyway since they trust your recommendation. Debt situation gets worse, client no longer trusts your professional judgment and severs ties, taking any ongoing or future business with them.

      This is your liability.

      As far as the consumer I spoke with, lets run through it for some insight.

      Consumer is unemployed, currently receiving less than 2,000 in unemployment. His mortgage alone is equal to unemployment benefits. Other expenses including credit cards total at least another 3,000 dollars per month. For a total of about 5,000 in expenses

      So we have a negative cash flow of at least 3,000 per month. Part of this problem is 50K in credit card debt. Wiping that out totally still leaves a significant cash flow deficit. 

      Now, since I assume the sales reps at Freedom are learned people with at least a 3rd grade math class under their belt, one should assume that the consumer was told that debt settlement wouldn’t make sense at this time given that he had more important things to worry about like EATING.

      But alas, we should never ass-u-me, because not even common sense was able to prevent the Freedom rep from pushing a 700 dollar a month settlement program. 

      To whoever that Primerica rep was that made that unfortunate referral, your reputation with your client likely just took a big hit, but you can at least be thankful I was there to keep it from getting worse.

      For the rest of you, take head, I am but one man and I cannot save you all.

      Caveat Emptor…

      • Charles Phelan

        Great comment, Damon. I asked the question back on 6/14, again on 7/13, but so far no one from Primerica has responded so I’ll ask again: How much compensation will PRI reps receive for referrals to FFN?

      • :-)

        How much do you get paid Charles at what you do?

      • http://www.zipdebt.com/ Charles Phelan

        Not a very intelligent question, anonymous Primerica rep: http://www.zipdebt.com/ordering.php

      • Awesome

        it depends on how much debt they enroll

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