It is absolutely no secret that I secret shop in my research. I respond to a lot of online ads to see the type of material and claims they make. The reality is I just don’t have the time to write about every non-compliant claim I hear from sales reps but this one is a doozy and clearly not in compliance with sales rules regarding the sale of debt relief services.
The highlighted section of the email was the way they sent it. I didn’t do that.
Okay, so I took the challenge. Let’s see how “in compliance” they were I thought. So I asked, “What kind of results should I expect from your program?”
The response, “However, our average is a 40% settlement rate. We can get as low as 20/25% depending on your creditors and your situation.”
I felt bad for the guy since he so badly flubbed up that answer and essentially promised me a 40% settlement rate, so I ask him to clarify the statement hoping he’d correct his error. “Does that mean the typical client gets a 40% average settlement or that the settlements you obtain are a 40% average?”
Sales representative says, “That means that you would more than likely be paying back about 40% of what you owe your creditor. Let me give you a quick example. If you owe a creditor $1000, we will negotiate to bring that balance down to about $400. Once you have saved $400 we will finalize that settlement for the discounted amount of $400. Leaving a zero balance.”
So while the company sends out emails proclaiming and giving consumers the impression they are “in compliance” when it comes to just the basic issue of fairly representing their services to consumers, it appears they clearly are not.
But in the interest of fairness, I would welcome the company to post independently audited facts and data that supports the typical client receives a 40% settlement offer. The FTC is very clear that marketing representations made cannot be of those clients that may settle but must represent the results obtained by all consumers enrolled.
I can’t help but to quote the red section of the initial email. “There are still many companies that are trying to get around this new law.” Apparently so.
Even the website of National Debt Resolution appears to make the same 40% claim on their home page when they say, “Use Debt Settlement to Reduce Your Balances up to 60%.”
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