I’m still stunned how the debt relief company No Debt managed to turn simple questions and a review of their marketing email sent to a consumer, into a total train wreck. See No Debt, Ultimate Debt Solutions, Credit Profiles, and Gregg Wright Email Raises Questions And Results in Ripoff Report to get a jump on this guest post below.
Matt Hearn is a debt relief industry compliance professional with MSTARS. I had asked Matt for his impression of the consumer email that had been sent out and he did his own research and provided his own feedback below.
The email sent to the consumer from the No Debt “Director of Compliance & Affiliates” read:
There is a fine line between help and harassment:
Given that we have hundreds of inquiries daily. I do not have the luxury of leaving more than a few messages and emails, before suspending a file.
My records show that based on your $XX,XXX, in unsecured debt:
We can have you debt-free in 36 months or less for around $XXX.XX, a month!
As your Attorney in fact we have what is called a fiduciary responsibility to work in YOUR best interest, as we aggressively strive to:
Render up to 80% of your unsecured debt un-collectable, and un-reportable, then settle the rest!
Allow interest-free, affordable monthly payments.
We do all this in 12 to 36 months (Depending upon YOUR financial circumstance).
Improve your credit score, as well as Credit Clean Up!
Assist you in obtaining NEW lines of Credit!
Our Program concentrates on legal debt invalidation & Settlement, and routinely defends consumers against credit card companies and collection agencies.
Upon completion of our program, we enable you to obtain new credit!
BECAUSE you are not escrowing 100% to settle debts which in most cases we can eliminate, our program is half as much as conventional debt settlement, and 36 months or LESS in length.
IF YOU HAVE ENROLLED IN AN INFERIOR PROGRAM – WE CAN GET YOU OUT!
We have a 25 year track record of success.
We have ZERO consumer complaints for our services.
We have maintained an A rating with the BBB, without having to pay for accreditation.
We have a 100% success rate.
We are the opposite of Bankruptcy, and give you a fresh start for up to 50% less than Conventional Debt Settlement!
You also have the option to leave a card out, continue to use it, and buy it down with what we are saving you.
I look forward to helping you become Debt-Free when YOU are ready, and I can re-open your file at that time.
Until then I wish you the VERY best!
Gregg R. Wright
Director of Compliance & Affiliates
Direct (XXX) XXX-XXXX
Toll Free (XXX) XXX-XXXX
Fax (XXX) XXX-XXXX
No Debt LLC – Ultimate Debt Solutions LLC – Credit Profiles LLC
OFFICE (XXX) XXX-XXXX
9170 E Bahia Dr. Suite 203-A
Scottsdale, AZ 85260
Matt’s Observations and Guest Post
I was forwarded this email from a company called “No Debt LLC”. Initially, I wasn’t surprised, as I see hundreds of these in any given month. I was asked to evaluate the letter with regards to compliance challenges as I saw it. Frankly, the entire message is problematic.
Let’s just start with the heading: Invalidate Debt-Restore Credit Scores-New Credit Line. These are very strong claims with absolutely no reference to substantiation artifacts or details as to how exactly this is done. This heading basically says “Hey, we can invalidate all your debt, make your credit stellar and give you brand new trade lines!” Let’s think about the average consumer’s net impression here. What would the average human being believe about what is being stated here? Never mind that if you are targeting a consumer who is in debt, they are considered a disparaged subset of the population, making “real” harm probable. No clarification was made as to what this program would entail or even what it is. Just simply, “invalidate your debt”. What does that make you think? What it makes you think or believe about what is stated is the first component to evaluating your UDAAP risks. This one? It’s a problem.
“There is a fine line between helping and harassment”. What does this even mean? Who are they referring to? Who would you assume they are speaking about? Not overtly noncompliant, but what is it insinuating? This part is just weird.
“Given that we have hundreds of emails a day I don’t have the luxury of leaving more than a few messages before the file is suspended.” What file? Do the recipients have an actual file? Where did they originate this file? What does suspending my file mean? Let’s first look from the viewpoint of an average consumer. An average consumer (let’s use me for the example, despite the fact that I feel I am an EXCEPTIONAL consumer, ha! I don’t like average.) This makes me think they have information about me in a file that is important and that if I don’t respond, there will be a consequence for my inaction. Heaven forbid, I was on vacation and completely missed this very important personal email regarding my “file”. I may have my “file” suspended. That would be bad! This is also bad practice.
“My records indicate that based your $XX,XXX in unsecured debt: We can have you debt free in 36 months or less for around $XXX a month” At this point, I decided to call them and ask some questions. The numbers I received on the phone were based on questions they asked me. I was quoted based on $50,000.00 in debt. Based on that number, I would pay for 36 months at $330 a month to the fees. Not one of those payments would go towards savings or debt. Now add what they said amounted to another 20% and my $50K of debt would be gone. $18K+ in fees over 36 months plus an undisclosed amount of money to “settle what was left”. You heard that right. That said, and for the sake of this ad piece, using numbers without substantiating those numbers is highly problematic. There was not even a disclaimer. If this statement was true, I would pay $18K and change and would HAVE to be debt free based on their written claim. The problem is, this statement isn’t true, doesn’t give any explanation and simply promises a result that is unattainable. Most consumers would bite. If it sounds too good to be true, it probably is. This claim is a problem.
“As your attorney in fact” “fiduciary responsibility” Really? Are they attorneys? Are they licensed in the state they are advertising in? Do they make the consumer believe they are attorneys? It certainly appears so. Remember, this is based on what an average consumer would be led to believe when reading this message. This is what would be considered a UDAAP violation, and yes, that is in direct violation of Federal laws as we understand them. Mind you, I am not an attorney, but feel free to ask one. They will agree.
“Render up to 80% of your debt un-collectable, and un-reportable, then settle the rest” So, why not render ALL the debt un-collectable and un-reportable? Why stop at 80% if this plan really does work. Why leave out a 20% cushion? I mean, you’ve come this far, why not go whole hog? Is there a special 20% that is out of the question? There is absolutely no mention of how, why or what. No disclaimers, no reference, nothing. A consumer will believe exactly what was stated and when they do less than what was stated, we have a problem.
“Interest free, affordable payments” This is creditor speak. This makes it sound like an interest free loan. If the first 36 months of payments are all fees, why would they need to stress this point at all? They are likely saying it to make the client feel like they are getting something special. They are getting an amorphous 0% interest thing that will cost them nothing to pay for! Wow! Now, that’s a deal! They don’t even charge interest for this thing I’m getting. I can’t wait to get into this “whatever it is thingy that will make all my debt go away in 36 months”. Ridiculous.
12-36 months. No reference, no details, no disclaimer.
“Improve your credit score, as well as clean it up” How exactly? I was told on the phone with them that I would receive a 150-point increase. That is a violation right there. No substantiation, no customer averages, no data to back that number up, nothing.
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“Assist you in obtaining NEW credit lines” I thought this was a debt relief program. So many questions, so few answers.
“Our program concentrates on legal debt invalidation and settlement and routinely defends consumers against credit card companies and collection agencies” OK, so why exactly are they “routinely having to defend consumers against the creditors and collection agencies”? That’s scary. This would indicate that a large majority of their clients are getting sued by the creditors they claim shouldn’t be able to validate the debts, right? Mind you, they informed me on the phone that the creditors simply send the letters they receive to lower level clerks who cannot locate the wet-signed copies of the credit card contract, therefore, it is uncollectible. No credit card company can locate those and therefore, it’s ALL FREE! Sound familiar? How about the “show me the note” scam that left thousands homeless? Yes, it’s the same old nonsense. There are more problems with this slick than I could address in an entire day. It’s a train wreck.
“Upon completion, we enable you to obtain new credit because you are not escrowing 100% to settle the debts in which most cases we eliminate” (notice the word “MOST CASES”. But below it states 100% success. So, shouldn’t that read “ALL”? What about that 80% comment above. Below, it states 100% success. It is extremely inconsistent and we still don’t know what the actual service is. This is a bucket full of holes (and false promises, outright misleading statements, inaccuracies and some boldfaced lies.) I won’t even get into the inaccuracies on the site. 25 years in business, 10’s of thousands of people graduated, etc. Never mind the “enable you to get new credit” and because you aren’t using that pesky escrow account and saving 100% of your payments towards those debts, it all gets to go to the fees! Isn’t that great?? Unlike those traditional debt settlement guys, we only make you pay half as much as they do. And it’s all fees. For you?? Special deal!!! Reg-u-lar price… 36 months or LESS. Is this something they can substantiate? I don’t think so.
And the best part of the program is if you are enrolled in an inferior program with a reputable provider, we can get you out. I mean, hey, if you can pay towards your debt, you can pay our fee.
Their website says they have graduated 10s of thousands of clients and the email boasts a 100% success rate. I’m just going to call that what it is. BS. I have run one of the most successful firms in the debt relief industry’s history and I know what that would take. It isn’t possible. Especially since it appears to be a 2-man operation. Leaving cards out is also a bit interesting. Wouldn’t those debts be invalidated also? Are we trying to use a loophole to screw the banks but choosing to use on of the “evil Bank’s” cards? Wouldn’t that be a bit self-serving? Maybe a little shifty, possibly even like fraud? And the kicker: I would assume that that $18K in fees paid upfront would fly in the face of the TSR amendment. And this entire horrific train wreck was carefully crafted by the Director of Compliance.
When will this nonsense end? There are many reputable, longstanding companies in this arena that are paying hefty price for this type of unscrupulous behavior. When a company in this marketplace misleads consumers, the reputation of the entire market suffers together.
This industry is currently seeing an influx of fortune 500 minded professionals seeking to dominate in this space by doing the job well. These fresh players are savvy. They understand the landscape, they know the rules and they are well funded. They see the opportunity that many in this space continue to abuse. The consumers of America need debt relief options and trustworthy firms that can deliver. They deserve companies they can trust. The companies need better tools, evolving technologies and a common core philosophy within the marketplace. There needs to be a new level of transparency and compliance. This is the next wave, and this time, we will not repeat the past.