It seems like a new variation of the Credit Card Defense Network (CCDN) approach at eliminating your debt through contract law trickery or novation is surfacing. CCDN is getting sued all over the place.
The Consumer Alliance Group program is being promoted by Todd Byrnes ([email protected]), who was previously affiliated with Court Mediation Services. Another failed program. You can read the complaints on CMS here.
In my opinion will wind up in trouble as well based on the ads they are running, claims they are making and information they are sending out.
Don’t fall for this program. There is little true about this approach.
Here is what Todd is saying about pricing for his program. “To eliminate up to 100K and 10 different accts there is a ONE time fee of $3995 plus $85 per acct. There are no monthly fees or payment plans. I hope you have done your home work in terms of what your options are, IF you have you will see that this is your best option. I have have gone through this process myself 2 yrs ago with 4 accts and 35K and it work beautifully for me. I have been selling it for the last 16 months and I have clients who have gone through it and will talk with prospects also. Dont let the uniqueness of this throw you, that is the beauty of it’s success. You will be able to get rid of this debt for less than 8 CENTS on the dollar. You will find that NO wheres.”
Why This Does Not Work
I would bet that within a year I’ll be reporting some lawsuit or state legal action against Todd Byrnes.
Email Marketing Program
Here is the email making the rounds.
Welcome to the most effective and fastest Debt Relief Process available!
Listen to the audio overview of our incredible process on our website or by calling…. 800-924-9825.
We have received your request for help and we are answering. At Consumer Alliance Group, we use Contract Law to wipe out your unsecured debt completely by changing the terms of your contract with your creditors.
Compared to our process, Debt Consolidation, Debt Settlement, and Bankruptcy are a JOKE!
Just look at the picture below to understand quickly how much more effective we are than any other form of debt relief.
- Debt Consolidation doesn’t get rid of a single penny of debt; it just restructures it.
- Debt Settlement only eliminates 35% of your debt at most after all the fees you’ll have to pay.
- Bankruptcy laws have changed so that most people still have to pay back everything!
- The Contract Law Debt Relief process through Consumer Alliance Group can wipe out 100% of your unsecured debt! There really is no comparison.
Consumer Alliance Group Process
- Payments Stop Immediately! You are NOT put on a monthly payment plan.
- Unsecured Debts are Wiped Out 100%, unlike debt settlement which only gets rid of 20-35%.
- Your credit can be restored in as little as 12-15 months.
- This process is infinitely more effective than debt consolidation, debt counseling, debt settlement, and bankruptcy.
- This process only costs a fraction of what you will pay with any other debt relief process.
Consumer Alliance Group
Debt Specialist Authorized Independent Rep
Office Hours M-Th 10-5 EST
Attachments to email:
CAG Explanation – Source
Consumer Alliance Group “CAG” Explanation
Hello, and welcome to the overview of the Consumer Alliance Group debt relief process.
This brief audio will not only explain how the CAG process works, but also why we
believe it is the safest and most effective debt relief process available today.
With over 65 years of combined expertise in all areas of debt resolution, CAG has
developed an extremely unique process that often far exceeds the results of a typical
“debt relief” company. In fact, over the last seven years, this process has offset thousands
of accounts, amounting to millions of dollars saved by clients.
Our process is not bankruptcy, debt consolidation, debt settlement, or any type of
payment plan. We do not work for your creditors, your bank, or any other third parties.
Unlike most companies out there, we only work for you.
Any unsecured debt can go into the process: major credit cards, signature loans, store/gas
cards, business/personal, and even most student loans!
Here’s how it works. Once you fill out your paperwork and submit your enrollment fee,
CAG immediately goes to work on your accounts. This starts with CAG taking legal
assignment of all debts that qualify for the process. By assigning the debts over to CAG,
you can rest assured that we have just as much interest in offsetting the accounts as you
do. This also makes us a real party of interest, allowing us to aggressively pursue unique
and highly effective debt relief strategies.
Once the assignments are signed and notarized, we need you to provide us with a recent
billing statement for each account. Our goal at this point is to change the terms and
conditions of the current creditor agreement, making them more favorable to us instead of
You are probably already aware that in your credit card agreement there is a clause that
says they can basically change the terms and conditions whenever they want. In the past,
you have likely received a “Notice of Change of Terms” from your credit card company,
which says they are increasing the interest rate or late fees etc., and you accept the new
terms by using the card again.
In the past you may have gotten a check in the mail, for $10 or $20, that on the back
where you endorse it there’s fine print saying if you cash this check then you are agreeing
to enroll in their credit protection service or some other type of monthly fee program. I’m
sure we can all agree that both situations show how creditors use contract law to create
and/or alter agreements.
What you may not know is that there is no law preventing any consumer from using the
same type of contract law practices to effectuate a change in terms to their own benefit.
Here’s how we use our expertise to make that happen.
When we send in the next payment to your creditor after enrollment, we include a brand
new set of terms and conditions, favorable to us, rather than the credit card company. On
the payment check, we put a note stating that when they cash this check, they agree to the
new terms and conditions. And they ALWAYS cash the check – we’ve done this for
years with literally thousands and thousands of accounts, and we have never had a
national or regional bank send the check back to us. Once they cash our check, they have
accepted the new terms and conditions. From then on CAG handles the matter and
makes the remaining payments under the terms of the new agreement.
As mentioned, our process is based on established Contract Law which boils down to
four parts- the offer, the terms, the acceptance, and performance. We’ve made an offer of
a new contract to the creditor, which clearly states the new terms of the agreement. The
new contract is accepted when they cash the check. From that point on, every time they
send a statement to us, and accept a payment from us, they are showing performance on
the new contract. We also show performance when we send those payments. There is
now a contract that both parties have accepted, and have been performing on for months,
with the only difference being that the terms are favorable to us instead of the creditor.
One of the new terms says that they are not allowed to put any negatives on your credit
report, and that if they ever HAVE put any negatives on your report; they agree to take
them off. The new contract also says that if they BREAK any of the new terms, they
agree to a financial penalty of anywhere from $500 – $2,500 per occurrence.
You’re aware that if you send a late payment to your credit card company, they’ll charge
you a late fee–right? You’re paying a financial penalty because you broke the terms of
the contract. Our new agreement does exactly the same thing except we are giving them a
taste of their own medicine. Even though they accept the new contract and perform on it,
they’re going to act as if they are still under the old contract. Therefore according to the
new contract, if they break any of the new terms we are able to apply penalty fees.
Every month they send out a new statement, on which there will usually be 3 or 4 term
violations, so we can apply those penalty fees month after month. And remember, under
the new agreement the credit card company has already agreed to this. Even though an
account may have a balance of $10,000, after 4-6 months, because they keep breaking the
terms of the new agreement, they will owe several thousand dollars in penalties. It’s too
late for either one of the parties to come back and say “Wait, I didn’t really want that
term in there”. Ask any judge or lawyer in the country and they’ll tell you that it’s pretty
cut and dried at that point.
The CAG process is usually able to offset up to $50,000 per any one account, making it
extremely effective for the average client.
Once you have enrolled your accounts and filled out the paperwork, we take over all
communications with your creditors or collectors. We notify the creditor with a new
address and phone number for contact. They’ll now start contacting us instead of you.
The statements will start coming to us as well, and we also switch annoying creditor and
collector calls from your phone to our special forwarding number. That way you don’t
have to deal with the annoyance and aggravation.
When you get a credit card statement from any of the enrolled accounts, say from XYZ
Bank, simply put the whole statement and return envelope into a bigger envelope and
send it to us. When we receive it we’ll write a CAG check to XYZ Bank. We will
faithfully honor the new agreement with the creditor, make the payments according to the
new terms and hold the creditor accountable to the same.
In the case of an account already with a collection agency, we use consumer protection
law. As we aren’t actually assuming the debt, the method we use is based on our many
years of experience in the collection industry, but the result is the same – the debt goes
There is another thing to be aware of:
Expect some negatives on your credit report during this procedure. Now remember that
putting negatives on your report is against the terms of the contract, but also remember
that the whole reason we can do this in the first place is because they don’t follow the
new contract. They will act as if they are still under the original contract, and we let them
do so until the penalties have offset the original debt. So after you have enrolled, go
forward on your calendar about 7 months and mark an ‘X’ there. At that time, order a
separate credit report on yourself from all three of the agencies and send them to us. As
for getting the negatives corrected, if you can show that something on your credit report
is a mistake, it’s against the law for the credit reporting agencies to leave it there – it has
to be removed. We will give you the documentation and instructions you’ll need to show
the credit reporting agencies. You can do it yourself, or we can refer you to another
company that can do it for you. So allow about 6-8 months for the debt to offset, then
another 6-8 months to get the negatives corrected. At the end of that time, about 12-18
months from when you get started, the debt will be gone and your credit report correction
will have been achieved.
Accounts need to be at least six months old to enter the CAG program; one year is better,
but they need to be at least six months old, with a balance of at least $500. If a large
amount has been recently charged to an account the following should be observed:
If a transaction has occurred of $5 thousand in a single statement period, we suggest
making the minimum payments for 3 months before enrolling that account. If a $10
thousand transaction has occurred, we suggest making 6 minimum payments before
enrolling that account.
The cost of the enrollment process depends on the amount of debt and the number of
accounts you have. For further information on how to get started please contact the
person who directed you here to discuss your situation and answer any additional
questions you have. Thank you.
Assignment Restrictions – Source
- CAG will NOT assume accounts with balances greater than $50K. They still will offer
new terms, apply penalty payments, and work to offset as much debt as possible. The
remaining balance may go away, but will most likely result in a settlement offer.
- If the client lives in Pennsylvania, CAG will not enroll student loans because wages can
be garnished at 15% without due process.
- The IRS can withhold tax refunds on federally backed student loans. This matter is
offset by legitimately taking additional tax deductions on your W-2 or 1099 so that you
would receive no refund. By taking this action you are keeping more take home pay
weekly and allowing the debt relief process to work for you.
- Individual student loans backed by private lenders in excess of $100K cannot be
included in the program.
- If an account has had any single transaction between $5K – $10K, or several smaller
transactions in a single billing period that add up to that, then we recommend making at
least three minimum payments on the account after the transaction date before CAG
enrolls the account. If the transaction amount during one billing period is more than
$10K, make at least 6 minimum payments before enrolling the account.
- Accounts must have a balance of at least $500 and be older than 6 months to be included
in the program. Accounts with the original creditor must be receiving paper statements,
or must be switched as soon as possible. CAG cannot offer the new contract without a
paper statement. This does not include an online statement that has been printed out.
Memorandum – On How the Credit Card Debt Collection Racket Works – Source
(1). Banks make consumer loans on unilateral installment contracts of adhesion such as
are credit card member agreements.
(2). As the superior party in a unilateral contract cannot sue for breach of contract, the
banks file insurance claims on non-performing accounts and collect insurance on the account.
Although the bank still was an actionable damage in pursuing a theory of “on an open account,”
the matter would require: (a). subrogation to the insurer, and (b). proof via authenticated
evidence and testimony of every single transaction to show a deficit; so, banks charge-off and
sell evidence of debt to attorneys in the illicit business of “debt buying” for a typical six cents on the dollar.
(3). Since installment contracts, such as are credit card contracts, are not negotiable
instruments and cannot be sold for value under holder-in-due-course theories of law, what ever debt had inured is extinguished along with the contract itself when sold.
(4). Attorneys in the illicit business of debt buying then use trickery, deceit, and harassment has tools to extort sums from persons no longer subject to lawful prosecution or liable for the extinguished debt.
Recipient is noticed: the above scenario is a blatant violation of 18 U.S.C. §§ 1341 &
1962 often, whether unwittingly or wittingly, requiring the complicity of state court judges, who
due to their duty to make inquiry, reasonable under the circumstances, gain complicity in
violation of 18 U.S.C. § 371.
Memorandum in support of the conclusion that debt buying is a substantial nationwide scam
organized to serve the incredible glut of surplus lawyers.
Attorney General Erases $3.5 million from Debt Purchaser’s Portfolio August 19, 2005
Attorney General (West Virginia) Darrell McGraw announced today that his office has
entered into a settlement agreement with Midland Credit Management, Inc. (“Midland”) of San
Diego, California resulting in the cancellation of more than $3.5 million in credit card debt
allegedly owed by approximately 3,500 West Virginia consumers. Midland had previously
purchased the charged-off accounts for collection from Cross Country Bank of Wilmington,
Attorney General McGraw’s office began investigating Midland in 2004 after
receiving complaints from West Virginia consumers who had been sued or contacted by
Midland to collect debts originally owed to Cross Country Bank. Cross Country Bank is a
credit card bank that markets high interest credit cards to consumers with bad credit histories.
McGraw’s office settled its lawsuit against Cross County Bank on June 21, 2005.
McGraw’s office questioned the propriety of collecting the accounts based upon the
same concerns that led to his lawsuit against Cross Country Bank. As a result of these concerns,
the Attorney General requested that Midland close all of the accounts with a zero balance and
notify credit bureaus to delete all references to the account from consumers’ credit records.
Midland agreed to do so in the settlement McGraw’s office announced today. 11/14/2005
Attorney General McGraw stated, “I commend Midland for promptly doing the right
thing after we brought our concerns about these accounts to its attention. As a result of our
agreement with Midland, approximately 3,536 West Virginia consumers have been relieved of
all further obligations to pay $3,548,539.80 in credit card debt. Because the accounts have also
been deleted from credit records, consumers will no longer be denied access to new credit as a
result of these accounts.”
Source: Attorney General Press Release
Suit alleges credit-card companies colluded – WSJ
Thu Sep 1, 2005 02:37 AM ET
NEW YORK, Sept 1 (Reuters) – A lawsuit filed in New York federal court alleges eight leading
credit card companies violated U.S. antitrust laws by colluding to promote arbitration of
customer disputes, the Wall Street Journal reported on Thursday.
It said the complaint alleges Bank of America Corp. (BAC.N: Quote, Profile, Research) , Capital
One Financial Corp. (COF.N: Quote, Profile, Research) Corp., J.P. Morgan Chase & Co (JPM.N:
Quote, Profile, Research) , Morgan Stanley’s (MWD.N: Quote, Profile, Research) Discover unit,
Citigroup Inc. (C.N: Quote, Profile, Research) , MBNA Corp. (KRB.N: Quote, Profile, Research)
, Providian Financial Corp. (PVN.N: Quote, Profile, Research) and Britain’s HSBC Holdings plc
(HSBA.L: Quote, Profile, Research) “combined, conspired and agreed to implement and/or
maintain mandatory arbitration.”
Many of the largest U.S. credit-card companies require customers to sign away their ability to
take disputes to court and instead settle disagreements in arbitration, the newspaper said. Now
that practice itself is under attack in court.
The suit was filed on behalf of seven plaintiffs who live in California, Pennsylvania, New York,
Illinois and New Jersey.
Some of the banks named allegedly convened a group in 1999 called the “Arbitration Coalition”
or “Arbitration Group,” the complaint says, according to the Journal.
The suit, which was filed last month and is seeking class-action status, claims that bank
representatives spoke or met at least 20 times from 1999 to 2003 to share experiences from
arbitration as well as advise each other on how to set up arbitration agreements with consumers
that would withstand challenges in court.
In general, it is illegal under federal antitrust law for competitors in any industry to secretly
collude to restrict trade or commerce, the Journal said.
A spokeswoman for Capital One said in a statement to the newspaper that the company does not comment on pending litigation. But she added that its “arbitration clause allows either party
involved in a dispute to have the case considered by an impartial arbitrator to determine a final
and binding resolution to the problem.” 11/14/2005
There was no immediate comment from any of the other banks named in the suit. The firms
named in the case have yet to respond to the substance of the allegations in court, the newspaper said.
Challenges for Collecting Purchased Debt
James M. McNeile
Cohen McNeile Pappas & Shuttleworth P.C., Leawood, Kansas
All of us know it is more difficult to collect purchased debt than originated debt by using
the traditional legal collection approach. The difficulties from a lawyer’s perspective lie mainly
in problems of proof. A creditor that originates debt has access to the documentation that courts
require attorneys to introduce as evidence in order to obtain a judgment. Many debt purchasers
either do not have access to the source documents or can only obtain those documents at great
cost. How then can debt purchasers utilize the court system to collect debts that are legally due
and valid? Ken Gelhaus reports that in New York the problems of collecting on purchased debt
have increased greatly in the last year. At one time in New York, court clerks entered a default
judgment on claims for “sums certain” without running the papers past a judge for review and
signature. In recent months, however, clerks are refusing to do so and requiring that a judge’s
order granting default judgment be obtained.
In one of his recent cases, Ken reports that he applied for a default judgment using the
affidavit of an officer of the purchasing plaintiff. The affidavit, although able to reference the
date of the purchase of the debt and the balance purchased, was deficient in that it did not include any actual business records of the originating creditor. The court found that the affidavit of the debt purchaser was insufficient and conclusory. The court suggested the debt purchaser furnish a copy of the assignment or contract assigning the claims, along with a copy of any statement or record clearly demonstrating the calculation and the amount of the claim. If monthly statements were furnished to the defendant, copies of the most recently sent statements should be annexed. Reliable and factual information concerning the claim is required.
Even if we as attorneys include such items, they are business records of the originating
creditor, not the purchasing plaintiff. At least in New York these business records would have no probative value, because no one at the purchasing plaintiff has “personal knowledge” of the
creation, maintenance, issuance, and tracking of the statements. In the eyes of the court, such
affidavits are hearsay and therefore not admissible.
A purchasing plaintiff is unable to swear to the authenticity of the originating or source
documents of a credit transaction because they do not have personal knowledge of the events
which transpired at that period of time in the life of the credit agreement. The original cardholder agreement, any correspondence, and monthly statements issued by the original credit grantor are not admissible as the purchasing plaintiffs business records, as the purchasing plaintiff has no personal knowledge of how those records were created or maintained.