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Global Client Solutions & Rocky Mountain Bank & Trust, Good People Tangled in Some Bad Debt Settlement Business

First, let me say that in my life in the credit counseling and debt management world I have had an opportunity to interact with the folks at Global Client Solutions (GCS) and Rocky Mountain Bank & Trust. I always found them to be professional and competent at what they do, manage client accounts.

The Global Client Solutions mission, as stated on their site is:

“Global is a revolutionary banking platform, trusted to solely provide the most robust and up-to-date account management products to the debt management industry. Our program was built specifically for the debt management industry to create a positive environment of success for both the consumer and debt management company.”

But here is where the waters appear to get murky and muddy for GCS. It’s not their payment platform that is troubling in any way. I’ve never heard a single complaint from anyone that GCS and it’s partner or participating banking partner, Rocky Mountain Bank & Trust has ever, or in any way diverted funds improperly. And from my past interactions with GCS I would have serious doubts that ever would happen.

The murkiness is being created by the companies they have voluntarily elected to take on as clients and process banking account withdrawals, from consumers accounts, and disbursements to debt settlement companies.

The Slope Gets Slippery Right About Here

As the debt settlement industry falls deeper and deeper into the bad actors pit, they are dragging GCS and Rock Mountain Bank right down with them. What’s that old expression, if you fly with the crows you get shot down with the crows?

In a search of civil cases filed where Global Client Solutions has been named, 2009 had been a very bad year for them. Before 2009 I could only find a record of two previous suits against them, one in 2005 and one in 2008, but so far in 2009 there have been seven lawsuits in which they have been specifically named as defendants. And it appears that the lawsuits are picking up steam as the year progresses.

So What?

We will just have to wait and see what Global Client Solutions decides to do about continuing to play in the sandbox with the debt settlement folks. Maybe they will decide that the risk just isn’t worth it to them. Probably the suits will continue and accelerate as states and individuals determine that GCS is operating more on the behalf of the debt settlement company, than the consumer.

If you have half a day to kill you can read through all the complaints I have linked for you above. What you will find is a developing pattern of participation by GCS and the debt settlement provider front end entity.

I’m left wondering why GCS doesn’t just abandon servicing the debt settlement industry, is the money they are making off of this just that good? Why would these good guys continue to associate with an industry filled with bad actors and companies of dubious distinction?

Global Client Solutions & Rocky Mountain Bank & Trust, Good People Tangled in Some Bad Debt Settlement Business
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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.
  • barbara

    Does anyone know of complaints or positivecomments on a debt settlment company called Square One in Florida or Legal Helpers Debt Resolution, LLC. I just signed up with them and then got served a summons from one of my credit card companies. They have been slow to respond to helping me.

    • http://GetOutOfDebt.org Steve Rhode

      For Legal Helpers Debt Resolution, read this article.

      For information on Square One, click here.

      Steve

  • http://www.unitedconsumerpartners.com Aaron R

    I have worked with GCS I am certain they grasp the magnitude of what they are in for or atleast they might after all these suits. I worked in debt settlement for about 3 years I was in sales and then customer service where I dealt with GSC personally they are really professional and did everything right. The problem is My company was very professional yes a member of TASC and at least BBB accredited however I’m not certain if they are anymore. I remember going through certain processes and stating clearly what GCS earned from each transaction and their monthly fees. I think they are just making so much right now that its pry to hard to back out look at Madoff lol. I can tell folks who are thinking about settlement some pretty scary stories Ill have a hit on my head by the settlement companies but anyways. Moral of the story is GCS is fully aware all payments and processes go through their system that I am sure that every settlement company is set up the same…..Also If you are in settlement you would get out like did client or employee cause unless you are in the back end you have no idea whats really going on.

  • http://www.everestdebtsolutions.com everest debt solutions scam

    yeah, Amy Kleinpeter I am also like this post,which has helped me settling my debt.

  • http://lawgrrl1.wordpress.com/ Amy Kleinpeter

    This is a super helpful post, Steve — thank you! Exactly what I was looking for because a client of mine has a lawsuit against a settlement company that was using GCS and Rocky Mountain Bank & Trust for the client’s escrow account and servicing. FYI: the State of California Department of Corporations has also gone after GCS for failing to become licensed and maintain a bond in California as required as a bill payer and/or prorater. http://www.corp.ca.gov/ENF/list/n/nw.asp
    .-= Amy Kleinpeter´s last blog ..I filed bankruptcy and got a discharge– why are collectors still calling me? =-.

  • http://www.riseabovedebt.com JD

    I agree, the good guys at GCS are getting sucked into lawsuits they should never be a part of, like us here at Rise Above Debt Relief, part of the “bad actors and companies of dubious distinction”.

    FYI, we have been released from the lawsuit, but unfortunately, the only info you have is from the plaintiff’s lawyer filing the lawsuit for $33,000,000!!

    Let me give you a few alarming facts about this case, and maybe you’ll see that there are also a few lawyers taking advantage of power and greed, which should be included in the “bad actors and companies of dubious distinction”.

    Just speaking for our company, we only charge the client 13% to settle their debt and have averaged 40% settlements for 5 solid years. So for 50-60%, our clients eliminate their debt, fees included. And we offer a $25,000 cash guarantee if we don’t save them at least 30%.

    Anyway, the Yunkers (plaintiffs) are in Kansas which requires them to have a lawyer oversee the settlement account, which we were in 100% compliance (you’ll see the lawyer’s names in the exhibit link). We settled 3 accounts for them in the first year (for 41.2%) and were about to settle a 4th when they lost income, quit the program and decided to file BK. The plaintiffs never had any complaints and were very appreciative of all the hard work put into their settlements.

    Their BK attorney had a different plan for them (and himself) and demanded $50k from us as he threatened to file a lawsuit, accusing us of operating in Kansas without the proper license. We did everything legally and ethically, so we did not pay the extortion demand. So he filed the lawsuit for $33,000,000. Well, after our lawyers got involved, the plaintiffs have dismissed the case against us, but the lawyer is still going after GCS and Rocky Mountain Bank (I guess because they are larger tnan us and might have more money to extort)

    The problem is that it is cheaper to settle, than fight the lawsuit. Anyway, I hope they fight it and win so these greedy lawyers and clients go after companies that hurt them, not the good guys at GCS and Rocky Mountain Bank.

    If you need any verification of what I posted, feel free to contact me anytime. We are working very hard to keep people out of BK with success, and we are working very hard to clean up the industry. Unfortunately, this lawsuit has put up a minor roadblock in our efforts, but we feel we are definitely not “bad actors and companies of dubious distinction”.

    • http://GetOutOfDebt.org Steve Rhode

      JD,

      Thank you for the update. It is much appreciated.

      Steve

    • http://GetOutOfDebt.org Steve Rhode

      JD,

      More thoughts. I completely understand what you are saying about right or wrong getting named in the suit. And this really isn’t about you or Ryan or GCS, is it. This is about the companies that use the services of GCS or NoteWorld that are operating outside the law and harming the consumers. That’s how GCS and NotWorld will get dragged in to more suits. You know, the “bad actors and companies of dubious distinction.” I’m working on an article right now where a company that has been operating illegally uses or has used both GCS and NoteWorld. They are probably going to be another company to drag them in to a future action.

      It does not matter how good or above board you operate, as the bad actors attract more attention and law enforcement, regulators and states get more and more complaints, the industry winds up harming itself by not taking action.

      This is why it has been my opinion that groups like TASC and others need to stand up and fight hard for federal legislation to regulate the industry in one fell swoop with policies that are considered fair and friendly and err if anything, on the side of the consumer.

      What most people in the debt world don’t seem to understand is that consumers in debt are already thought of as a disadvantaged class of people. Any single action, like heavily front loaded fees, will meet with overreaching action by regulators because it is grossly unfair. Fees should be handled as an attorney would, held in trust and only taken as earned.

      Anyway, right or wrong, now that you’ve been named in a suit you are more likely to be named again and your liability insurance may be rising. I’m not saying any of this stuff is fair but as long as you are in the debt settlement world, like GCS or NoteWorld, the good guys will finish last.

      The best step to take at this point would be for a association to form or TASC to change to move for and support aggressive changes including limiting fees and placing fees in trust with a generous refund policy. If TASC or some group had done that three years ago, you would not be living through this crap now.

      Steve

    • http://GetOutOfDebt.org Steve Rhode

      JD,

      I just noticed that Global Client Solutions got sucked into another suit filed today by the state of Florida. This time they are included in the suit but not a party in the suit. Still, they were part of the process that Florida is claiming is a problem. Look at the actual ADA complaint I mention here.

      Steve

  • http://www.creditcarddebtpro.com Ryan

    Steve,

    Its not about the ads- do some research about noteworld as well. I’d be curious to see what an A rated company by the bbb has going on

    Ryan

    • http://GetOutOfDebt.org Steve Rhode

      Ryan,

      Will do. You know, I don’t have much to say to support the BBB. I’ve been critical of them in the past. Most people don’t realize they are a franchise operation with individual protected territories and have no power of enforcement or regulation.

      It is easy to be an A rated business with the BBB. Make an application to the BBB, buy their top line business package and be in an industry that does not have a black eye. For example, debt settlement companies start out with the BBB at a disadvantage. According to the BBB debt settlement companies are already a lower rated business even if they do everything above board like you.

      The other issue I have with the BBB is that they do nothing more than pass correspondence along between a consumer and business. Since they have no authority to regulate they have no power to protect consumers.

      I did discover an interesting link in doing my research this morning for you but I’m sitting in a parking lot right now waiting for my wife. I just thought I’d take a quick minute to respond to this comment. When I get back home I’ll work on the other.

      Steve

    • http://GetOutOfDebt.org Steve Rhode

      Ryan,

      The 2009 NoteWorld issue appears to be something they got dragged into because of the debt settlement company they were associated with, a Mezey & Associates and NDS. The judgment awarded was for $184,405.68 plus attorney fees and costs.

      What was surprising this morning was I got my hands on the debt settlement contract for Everest Debt Solutions that I’ve written about here and here. In the EDS contract it says that they work with both Global Client Solutions and NoteWorld.

      This is probably an excellent example of what I was writing about in my post that these processing companies are going to get sucked into more lawsuits and enforcement actions because of the actions of the debt settlement sale.

      In the EDS example, I wrote about how EDS appears to operate out of a UPS mail center post box in Florida and in this one example sold debt settlement services to a person in Minnesota in which they are not licensed.

      The other interesting issue about the servicing companies is that one argument that has been made in one of the complaints linked above was that the debt settlement fund account was not really under the full and independent control of the client consumer since the consumer only had limited authority over the account and was only able to stop deposits into the account but had no authority to change the debit amount directly with the payment processor. The payment amount was controlled by the instructions from the debt settlement company which certainly seems to mean the settlement company does maintain some control over the account.

      So because of this tie the payment processor might be held to be an agent of the debt settlement company and thus will get sucked in to actions against the debt settlement company.

      I have no knowledge of any current or impending action that might cause this but it would be possible for both GCS and NoteWorld to get so sucked into the debt settlement actions and suits by bad actors they are tied to they may cease business or be forced out of the business. In that case the debt settlement payment processors become a single point of failure for any debt settlement company tied to them.

      Steve

  • http://www.creditcarddebtpro.com Ryan Ortega

    Steve,

    There’s nothing personal I take towards your opinion on the debt settlement industry. I know my position is to make sure people aren’t being taken advantage of or treated unfairly, and can only control my actions and support those who do the same. However there are some bad actors out there, and there’s good ones- just like there are bad mechanics, and good ones.

    I’m fully aware there’s pending legislation, the Attorney General’s and the FTC http://www.ftc.gov/bcp/workshops/debtsettlement are all paying attention to the debt settlement industry. There might be some reform, and it will probably come from the credit card company lobbyists, before it comes from the consumers.

    I’m still wondering why if you feel these “consumers are getting royally screwed by bad debt settlement companies and their massive up-front fees” why you would continue to allow their ads on your website.

    I’ve done my research on ppc advertising in this industry debt relief companies and lead generators pay anywhere from $15-20 just for a click, Is there too much money coming in from this bad actor industry for you to let go? Not to say all the ads on here are poor companies however you’re supporting the debt settlement industry by letting their ads appear.

    It just seems to me if you’re really against letting these bad debt settlement companies screw people over you would refuse to let them advertise on your site. I know it’s hard to control who shows up, maybe find another resource of ppc advertisers, like coupon or personal finance sites.

    There’s plenty of other good industries out there you can benefit from having advertise on your site, unless you do believe that full disclosure debt settlement is a good choice for consumers to make and want them to have access to it on your webiste.

    Ryan
    .-= Ryan Ortega´s last blog ..Having a monthly budget is a common way to fix money problems. =-.

    • http://GetOutOfDebt.org Steve Rhode

      Ryan,

      I just sat down at the computer to research that lawsuit involving NoteWorld.

      $15 to $20 a click, LOL. I don’t know who is getting that. Google might be charging that but I certainly don’t see it. My ad policy is clearly stated on the site here.

      Is this an issue about advertising or are we trying to discuss the current problems and reality of the debt settlement industry? If this is an advertising issue I think I covered that above. It doesn’t seem that you are that interested in me spending time and money to research the NoteWorld issue for you.

      Steve

  • http://www.creditcarddebtpro.com Ryan Ortega

    Steve,

    I wouldn’t consider gcs to be the problem, They don’t represent the upfront promises made by these debt relief companies ads or sales people, which would appear to be the main reason for the lawsuits.

    Do you have any details about these types of actions with note world servicing center, they hold funds for clients that are with debt settlement companies too.

    Also I think it would be similar to somebody saying you’re responsible for them entering a debt settlement program because they chose to click on one of the 10 google ads for debt relief on your website. I know you’re offering free advice, but in my opinion you seem to have a huge distaste for the debt settlement industry, yet continue to still let their ads display all over your website, which of course pays you money- does that mean you’re part of the problem and should be included in the lawsuits too?
    .-= Ryan Ortega´s last blog ..Having a monthly budget is a common way to fix money problems. =-.

    • http://GetOutOfDebt.org Steve Rhode

      Ryan,

      As I wrote, I’ve always know GCS to be good guys but based on the accelerating lawsuits they are getting named in as a result of their affiliation with the debt settlement industry, it is only dragging their good name down. As far as I know GCS has no role in the marketing of debt settlement services.

      Read the complaints I linked to and you’ll see how they are getting sucked in to RICO complaints and accusations of violations of FDCPA and debt adjuster laws in various states. For them it fully appears to be guilt through a business relationship with debt settlement companies. These cases will create a precedent that can then be used against other processing entities like a NoteWorld Servicing Center. In fact it does look like NoteWorld was named in a June 26, 2009 suit with a couple of debt settlement companies. I’ll take a closer look at the case and post an update if the issues that dragged NoteWorld in are similar as those that sucked GCS in.

      Ryan, I know you are the owner of Common Cents Credit Solutions and you offer debt settlement services and my talk about debt settlement services probably strikes a nerve but the warnings and concerns about debt settlement don’t start with me. Just take a look around at the state Attorney General’s that have cracked down on the bad actors, the FTC work to regulate the industry and the new wave of legislation that is coming to stamp out up-front fees or at least highly restrict them.

      And the reason for all of this, consumers are getting royally screwed by bad debt settlement companies that are taking massive up-front fees and leaving people to pick up their trashed credit and face the creditor lawsuits. And while the debt settlement industry has done an absolutely horrible job of policing itself, as I wrote about a long time ago that they should have, the underlying problem is that debt settlement is an incomplete solution without the power of the law behind it to make it a binding solution on all creditors with an outcome based on a legal framework.

      You might be the best and most honest guy in the debt settlement industry, but that does not matter. This industry will be painted with a broad brush and the good guys, you included, will be dragged under by the bad actors. I’m not a gambling man but I’ve seen enough history in the debt management world to feel very confident about placing a wager on that.

      Steve

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