WRAL television in Raleigh, NC is reporting Consumer Law Group of Florida, who was recently sued by the NC Attorney General, has agreed to pull out of North Carolina.
Under North Carolina law, it’s illegal to charge an upfront fee to help negotiate debts, also called debt adjusting or debt settlement. Some companies promising debt relief, including Consumer Law Group, have tried to get around the law by claiming to be law firms.
Wake County Superior Court Judge Ripley Rand agreed late last week to a consent preliminary injunction in the case against CLG of Boca Raton, Florida. The Attorney General filed suit against CLG, its managers, Michael L. Metzner, Ran David Barnea and Daniel T. Post and a related company, American Debt Negotiators, Inc. October 1. Cooper is asking the court for a permanent ban against CLG’s debt relief activities in the state, refunds for North Carolina consumers, cancellation of all contracts, and payment of civil penalties.
The Attorney General contends that CLG deceived consumers by promising to reduce their debts by half and leave them debt-free without bankruptcy. In reality, CLG rarely worked out agreements to settle debts but kept substantial fees anyway. The company also misled consumers to believe that its program is government-affiliated, and claimed that its services are performed by attorneys when they are not. Metzner is a Florida lawyer but he is not licensed to practice in North Carolina and the company is not a law firm.
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