A debt relief company named Debt Assistance Network hit my radar. People are under the impression the company will assume their debt and somehow fight back to eliminate debt. Fees are steep.
I typically advise consumers that anyone considering using such a company should read the following free guides and do their own research.
- The Ultimate Consumer Guide to Checking Out a Debt Relief Company Before You Sign On the Line
- 10 Must Do Steps to Find the Best Counseling or Settlement Company for You
- How to Check Out a Business or Company to Avoid Getting Scammed or Ripped Off
Where is the Debt Assistance Network Located
The BBB says DAN is located at 4730 S Fort Apache Rd STE 300, Las Vegas, NV 89147-7947 and says Lee Sands is the owner. The address comes back to Nevada Corporate Headquarters which is a business entity formation company.
The State of Nevada says Debt Assistance Network is in default and not in good standing.
They Say They Assume Client Debt
The position description of the National Director of Affiliate Relations for Debt Assistance Network (DAN) appears to affirm they claim to be able to assume the debt of consumers.
Carole Carlson is the President and CEO of USMarketers and also claims to be the DAN National Director of Affiliate Relations. Carlson describes DAN by saying, “We provide a different kind of debt relief/resolution by getting rid of the debt through various means, even original creditors by assuming the debt.” – Source
Consumers appear to be under the impression DAN will somehow assume their debt obligations unilaterally and free the debtor from all liability of that debt.
They could certainly get that impression from the additional representation by Carole Carlson who allegedly said, “I run an affiliate network for associates in the fields of financial consumer advocacy. We simply get rid of debt…not settlement, negotiation or consolidation. We assume it and get it dismissed. Flat rate for your customers, and pays affiliates 15% of their clients debts enrolled. Proven technology.” – Source
The BBB listed (800) 610-3440 as an additional phone number for DAN and that is how I made the connection to Carlson’s statement.
Another site for dancorporate.com (seems to be more aimed at affiliates) also says “Original Creditor: Consumer simply assigns open accounts with original creditors to DAN. Using their expertise, DAN makes an offer to the creditor to amend the card agreement to extremely favorable debtor terms, e.g. 0% interest, no over limit fees, no late payment fees, no negative reports to credit reporting agencies, and others, AND from the date of amendment acceptance, DAN makes the payments under the new terms. Consumer makes no further payments to creditor!” – Source
The BBB has given the company an F rating. Consumer complaints filed with the BBB are interesting.
Assumption Marketing Not New
It appears the “we can assume your debt” strategy has been ongoing for some time.
A 2021 court document in a suit filed against Debt Assistance Network says, “Sometime prior to April 7, 2016, Plaintiff amassed various consumer debts. Dkt. 1. On April 7, 2016, Plaintiff and Defendant signed a “Consumer Tender of Offer and Debt Assumption Agreement,” in which Defendant agreed to “make contractual offers” to “modify the agreements with the debtor’s creditors, and when accepted [it] will make the payments relating to said accounts under the modified agreements from the monthly statements received from the creditor.” Dkt. 23-1, at 4. If a debtor’s creditors did not agree to a modification, the Defendant offered a 100% refund. Id. Plaintiff paid a debt assumption fee of $8,853.16 for a “total enrolled debt of $22,134.20.” Id., 2. Defendant told the Plaintiff to stop making payments to creditors. Dkt. 23-11, at 7.
According to the Plaintiff, the Defendant did not respond to his multiple inquiries into whether his creditors had accepted the modified agreements. Dkt. 23-13. Around May 29, 2018, the Plaintiff began receiving collection letters from attorneys for one of his creditors. Id. Defendant did not meaningfully assist the Plaintiff and in August of 2018, one of his creditors filed a lawsuit against the Plaintiff. Id. The Plaintiff again turned to Defendant for help, but it did not assist him until December 15, 2018, when legal representation was finally provided to the Plaintiff. Id. The Defendant failed to provide any documents to those lawyers, and the Plaintiff’s repeated requests to send them went unanswered; Plaintiff finally demanded a refund for $11,268.79, which the Plaintiff asserts represents the total he paid ($450 for setup fee, $10,458.85 for 29 months of full service, and $359.94 in administrative fees) . Id. According to the Plaintiff, he did not receive a refund, his creditors have not been paid, no credit repair has been performed, and the accounts are in default. Id.
On January 9, 2020, the Plaintiff filed this case, asserting claims against the Defendant for violations of the Credit Repair Organizations Act, 15 U.S.C. § 1679, et. seq. (“CROA”), the Washington Consumer Protection Act, RCW 19.86, et. seq. (“CPA”), negligence, breach of contract, intentional misrepresentation, and negligent misrepresentation. Dkt. 1. Scheduling orders were issued, the Joint Status Report was filed, and the parties began discovery.
In September, October and December of 2020, the Plaintiff moved for, and was awarded, sanctions against the Defendant for Defendant’s Fed. R. Civ. P. 30(b)(6) representative’s, Lee Sands, failure to appear at three scheduled depositions. Dkts. 12, 16 and 22. After finding that the requirements of Western District of Washington Local Civil Rule 83.2(b)(1) were met, the Defendant’s lawyer was permitted to withdraw. Dkt. 13. Although the Defendant was warned that as a corporation it must be represented by counsel, no lawyer has appeared for the Defendant.
The Plaintiff now moves for summary judgment on his CROA, CPA, negligence, and breach of contract claims. Dkt. 23. The Defendant did not respond.” – Source
Fortman v. Debt Assistance Network
The court ruled in favor of the consumer and issued a Partial Summary Judgement that said:
“• GRANTED as to Defendant’s liability on the Plaintiff’s CROA, CPA, negligence and breach of contract claims, his motion for an award of $11,268.79 in actual damages, and his motion for an award of costs and reasonable attorneys’ fees;
• CONTINUED TO MAY 28, 2021 as to his claims for $5,000 in emotional distress damages, $2,500 in “credit damages,” and for treble and/or punitive damages;
• The deadline for the Plaintiff to supplement the record, if possible, to provide the evidence and explain the grounds for the claims for $5,000 in emotional distress damages, $2,500 in “credit damages,” and for treble and/or punitive damages IS MAY 28, 2021;
• The deadline for the Plaintiff’s attorney to supplement the record with a cost bill and attorney’s fee petition May 28, 2021; and
• By May 28, 2021, the parties SHALL INFORM the Court, in writing, what remains in the case or if the case can be dismissed and closed after entry of final judgment.”
The Court subsequently awarded “$37,012.50 in attorneys’ fees and $3,835.63 in costs for a total of $40,848.13.” – Source
In the original suit filed by Fortman he claimed “Defendant charges consumers fees and represents that it provides debt relief debt negotiation, and debt management services to Plaintiff and similar consumers to eliminate or reduce their debts and, either expressly or impliedly, ultimately improve their credit scores, credit reports, or credit worthiness. Defendant preys on consumers like Plaintiff who find themselves deeply in debt or with poor credit, and are therefore especially susceptible to Defendant’s illegal and deceptive practices.” – Source
At issue also was if DAN acted as a Credit Repair Organization as well.
A Number of Cases Involving Debt Assistance Network
The Fortman case is not the only one in federal court. I have no idea how many might be in local or State court as well. I did find this class action Georgia case.
But here are others I found with an easy search:
- Trent v. Debt Assistance Network, LLC (3:21-cv-00574) District Court, S.D. California – It does not appear DAN even bothered to respond and lost.
- Fernandez v. Debt Assistance Network, LLC (3:19-cv-01442) District Court, S.D. California
- HUNT v. DEBT ASSISTANCE NETWORK, LLC (1:18-cv-00644) District Court, M.D. North Carolina
Hunt v. Debt Assistance Network
DAN has a strange way of dealing with cases filed against them. In Hunt the Court said, “This action was originally filed in State Court but was removed by Defendant to this Court. (Doc. 1) Defendant then moved the Court to stay the proceedings due to an arbitration clause that Defendant claimed governed the facts of this matter. (Doc. 8) The Court agreed with Defendant’s position and stayed the matter pending arbitration before the American Arbitration Association. (Doc. 18)
Arbitration of this matter was held in Arizona. While Defendant initially participated in the arbitration, Defendant, through counsel, later ceased participation in the arbitration. Defendant’s counsel also withdrew from representation in this case. (Doc. 28)” – Source
Referals by Others to Debt Assistance Network Lead to Liability
A 2020 finding of fact by the State of Oregon Department of Consumer and Business Services Division of Financial Regulation found the company sending consumers to DAN was guilty of violating the law. The State issued a $20,000 Civil Penalty against EZ Credit Consulting and Repair, Erin Swann, EZ Credit Consulting, and Karen Seavy.
The State document says, “The Director FINDS that:
1. EZ Credit is a limited liability company that administratively dissolved on December 1, 2016. Swann and Seavy were EZ Credit’s officers.
2. Swann and Seavy continued to conduct business as EZ Credit Experts and EZ Credit Counseling following EZ Credit’s dissolution.
3. At no time have Respondents been registered to perform debt management services in Oregon.
4. From in or around 2017 through in or around 2018, Respondents improved or offered to improve the credit record, credit history, and credit rating of Oregon consumers for compensation.
5. From in or around 2017 through in or around 2018, Respondent referred Oregon consumers to Debt Assistance Network, LLC (“DAN”), claiming that DAN would assume and reduce their consumer debts.
6. Swann and Seavy received money or other valuable consideration, or expected to receive the same, for referring Oregon consumers to DAN.”
The findings stated “The Director CONCLUDES that:
7. By improving or offering to improve the credit records, credit history and credit ratings of Oregon consumers for compensation, Respondents performed “debt management services” as defined under ORS 697.602(2)(b).
8. By performing debt management services without being registered as Oregon debt management service providers, Respondents violated ORS 697.612(1)(a).
9. DAN is a “debt management service provider” as defined under ORS 697.602(3).
10. By referring Oregon consumers to DAN, for which they received or expected to receive money or other valuable consideration, without being registered as Oregon debt management service providers, Respondents referred consumers to a debt management service provider, in violation of ORS 697.612(1)(b)(C).
11. Because the Director has reason to believe that Respondents have engaged in violations of the Oregon Debt Management Service Provider Law, the Director may issue an order to Respondents to cease and desist from violations of ORS 697.612, under ORS 697.825(1)(a).” – Source
In 2019 the State of Oregon found Debt Assistance Network violated State law and hit them with a $100,000 civil penalty. – Source
DAN Says They Don’t Do Credit Repair
If you read the BBB complaints by consumers the response of DAN says they are not involved in credit repair, “We explicitly stated we have nothing to do with credit repair.”
On the website for DivorceYourDebt.com that reads as if it is an agent, affiliate, or DAN itself, the site appears to read as if credit repair services are included.
The website says, “We offer an alternate solution to bankruptcy, debt consolidation, debt settlement and debt invalidation.” – Source
The site says “Credit Repair for the accounts INCLUDED!” and that the fees for the program are a $250 application fee, $100 per account setup, and 45% of the total debt spread into 36 months of interest free payments.”
The Site Says Debt is Assumed
The website states the program works like this:
“You legally assign each open account to us.
We take over all communications with collectors.
We offer your collectors a change of terms from the original agreements to terms far more favorable to you.
Once accepted and in place, we make the payments under the new agreement and you have no more direct contact with the creditors.” – Source
The website dancorporate.com says “Only approved Network Affiliates may utilize this program as a part of their ongoing business model. There is a rigorous process DAN uses to qualify potential Affiliates, and once they have been approved, DAN provides training on how to implement the program and grow their businesses.” I guess this one slipped through the cracks then.
Debt Assistance Network Claims
Some bold claims about DAN are made on the Divorce Your Debt website. On face value they appear to run afoul of the FTC Telemarketing Sales Rules on debt relief advertising.
For example, DAN says “through DAN’s expertise, reduce the chances of being sued to near zero.” Is that a true statement from client data?
The FAQ page also says “By enrolling in the DAN Program, debts are rendered uncollectible. At a prescribed time, DAN will notify you that your program is substantially complete, and it will ben be time to engage a credit restoration specialist. DAN will recommend the best in the business to you.”
The page also says, “for all accounts enrolled, the Debt Assistance Network uses its many years of expertise to achieve their goal of rendering the debt uncollectible. While it may be possible that the creditor sends a 1099 for the debt rendered uncollectible, this would be a breach of your rights.” I find that hard to believe.
Finally, the FAQ page says “The staff has many years of experience in debt collection, mediation and debt resolution negotiations.” – Source
But I’ve shown you the company has lost in arbitration, not responded to suits against them, and lost in another and owes money back to the consumer.
I would love to have a DAN representative respond to this post and provide evidence of a major creditor accepting their offer in writing to assume the debt.
Until that time, I’m calling bullshit.
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I also hired DAN and paid them approximately $15K. I received a lawsuit from a creditor and quickly reviewed my contract with DAN which stated they would provide an attorney in case a creditor sued. When I informed DAN of this, they basically dropped me. I called and emailed Carole daily quoting my contract. I never got a response and was forced to call the creditor and negotiate for myself. I then cancelled my contract with DAN and that is when I received phone calls from them which I have kept the voicemails. It makes me sick that I paid them all that money.
I signed up with DAN program in early 2020. After a few months of $10 payments to my 4 creditors they stopped paying anything in August 2020. I have been sued by 2 of the 4 accounts. Hiring a local Las Vegas attorney to get a settlement amount it was discovered apparently an attorney in another state was hired on my behalf by DAN program. That attorney’s office never responded to one of the lawsuits requests, nor did I receive that request. The 2 creditors that already sued have been paid their agreed to settlement amounts. However I have 2 more accounts to settle and paid DAN program about $11, 070 plus the initial start/admin fees. I have been told to report this to both the Nevada attorney general and cfpb website.