Debt Relief Expert With Background You Don’t Know About

Photo Credit: Mastery of Maps

I always have as much fun with titles to article so I thought I’d have fun with an article about myself.

The funny thing is I’m writing an article here that doesn’t need to be written and I’m outing myself. Now that’s investigative journalism for you. No story left unturned.

My life for the most part is an open book. I really try my best to live a life without secrets so I wanted to tell you about something that nobody has published about me. It happened a long time ago now but like everything else out there on the web, if someone was to stumble across it they might wonder what it was all about so I thought I’d tell you about it. And before you wonder, the issue it’s not terrible, just unfortunate.

I started and ran a non-profit credit counseling organization called Myvesta and this happened back in those old Myvesta days.

From 2000 to 2002, Myvesta had been in contact with the State of California asking for clarification on their licensing laws for debt management groups. We wanted to get written confirmation of our exemption under the licensing requirements in the State of California. Nonprofit groups were exempt for the license and Myvesta was a nonprofit group.

Repeated letters and phone calls from our staff attorney to the State of California person responsible went unanswered. Our last communication with them was in June of 2002 in which we stated that unless the state responded to our requests for an opinion on the matter that we would be left with no other choice than to assume that we were in full compliance with all appropriate laws. We received no communications from the State of California stating they had any concern with any of our assertions, programs or services. In fact, we had never received any communications from the State of California with any concern or inquiry. All of the communications had been proactive on our part.

On Christmas Eve 2002 we received the desist and refrain order for some Myvesta services. From the very beginning the desist and refrain order made no sense. The order stipulated that Myvesta was in violation since we offered a Debt Eliminator program that “involves negotiating a repayment plan with creditors on behalf of consumers.”

The Debt Eliminator program was a printed report that showed consumers how to repay their creditors in the shortest amount of time while paying the least amount of interest by prioritizing debt repayments. It did not involve any creditor contact, payment of any bills, the collection of any money from a consumer to pay bills, or negotiation; at all. It was a mathematical computer program that printed out a paper report.

We tried our best to help the State of California realize they had made a terrible mistake. We also responded with a log and copies of all of the attempts seeking clarification on the law that was in question regarding Myvesta’s AllPaid program where we paid the monthly bills for a handful of California clients. The State refused to review our pleas and, in fact, said that if we pressed the matter further they would send someone to Maryland to get me and throw me in jail. Lovely.

Feeling frustrated, afraid and discouraged that we were not getting anywhere with the State of California representative, we contacted the Governor’s office in an attempt to escalate the matter and get someone else at the State to review the situation. The Governor’s office referred us right back to the original person that we were working with. You can only imagine how well that went over, not very well to say the least.

We then asked to appeal the issue and the person handling it told us that we were welcome to appeal it, but since she handled all of the appeals we would certainly lose. We were stuck in a no-win position.

In an attempt to resolve the situation (and at a significant cost to Myvesta), we hired a large California law firm to represent us with the State of California to work out a resolution to their mistake. The law firm came back and said that in their experience they had never seen such treatment. They said there was no other way to view the situation other than that the State was going through a massive budget crisis and was simply trying to extort money from companies to settle frivolous disputes. The State then offered to settle the dispute with Myvesta for $10,000. They even called back the next day and said that for an additional $5,000 they would not pursue the matter in the future through any other California agency. Basically, they blackmailed us into settling a baseless complaint because the cost of settling it was less than the cost of fighting it, knowing we did not have the resources to fight it further.

The irony is that even after the settlement the State of California requested that we not abandon the current California AllPaid clients for whom we were paying their monthly bills. They actually left us with instructions that we could neither continue to service the clients nor discharge them. When pressed, they could not provide any additional clarification so we decided at that time to arrange for an orderly termination of the Myvesta California AllPaid clients. We actually had clients crying because we were no longer able to assist them in California with that program. It was a horrible experience and to this day I can’t understand why the State of California would not admit to their mistake.

The irony here is that in the whole episode the State of California never raised an objection about the debt management clients were were helping at that time in California. You would have thought that since that’s what we had the most number of it would have been something they would have wanted to talk about.

The strange thing is that a few weeks before all of this happened I had done a radio interview on a big California radio station in Los Angeles or San Francisco where I had been really critical of the credit counseling industry becoming debt collectors for creditors instead of putting consumers first. I still think this whole episode was the result of me ruffling some feathers out there in the credit counseling world with that interview. I remember ending the radio interview and thinking if another credit counseling group had been listening, they were probably not going to be very happy with me for speaking the truth.

And that’s the whole story.


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Damon Day - Pro Debt Coach

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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.
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2 thoughts on “Debt Relief Expert With Background You Don’t Know About”

  1. I know what you mean with dealing with government agencies sometimes. When you have a complaint, they will eventually make you feel you are the evil one.

  2. I know what you mean with dealing with government agencies sometimes. When you have a complaint, they will eventually make you feel you are the evil one.


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