A reader, now a beloved tipster (send in your tips here), sent in some questions about a San Antonio, Texas company, Debt Free Angels.
Here is what Shawn said.
“Debt is Gone Forever!
Debt Free Angels Guarantees that 60% to 80% of your debt will be eliminated forever .” – Source
In the video on the front page they say “the laws are on their side, we make sure they are protected”, “we help people to eliminate their debt, reduce their mortgages, clean up their credit and get back on track”. The video shows the major programs and they” eliminate 60-80% of all of the credit card debt” , loan modification where “everyone qualifies” and credit repair to “getting them qualified to purchase a home in 12 months or shorter” as well as how to save $6,000 to $10,000 on their taxes. They also say “lots of our services are free, some of the ones that you do pay for there is always a money back guarantee” There are no disclaimers on their site that I could see.
KSAT – Local Experts for Debt Elimination!
The Federal Trade Commission is on Mission to shut down Attorney based Telemarketers who APPEAR to be legit in settling debt.
We are the authentic Debt Elimination company supported by and promoted by local channel 12, KSAT. The new rules, as of October 27th, 2010, have put 90% of the companies out of business-the FTC is fining and often jailing those who have hurt so many familes across America.
We were already in complete compliance, and in fact have been since we started over 6 years ago!
We are Debt Elimintion with Integrity-we are Debt Free Angels-who do you know, that needs an Angel on their side? – Source
Shawn says, “Being in the financial industry, I have seen lots of these types of so call “debt elimination” companies making outrageous claims, but this one takes the cake.”
It appeared that the points and links in Shawn’s tip were true and accurate so I decided to take a closer look at the site. What struck me at first were all the claims made on the home page. They seem to fly in the face of claims made by others that the FTC has pursued action against. I’ve marked some of the claims on the home page which are problematic in my opinion.
Here is my rundown of concerns.
They also put out the following video about their debt settlement program. The video makes some statements which concern me.
Readers of the site will already know why these statements concern me. But for those unaware, the statements of debt reduction are against the FTC guidance on debt relief marketing unless they represent the collective experience of the company with every aggregated debt enrolled by all consumers. The statements of having debts removed off the credit report are disturbing. It appears to be an inducement for the consumer to potentially get trapped in a credit fraud situation when they latter use a credit report that has had true and accurate information removed. A cease and desist letter is almost a surefire way for a consumer to invite being sued by their creditor. And the letter has no power over the creditor which owns the debt, only third party debt collectors. Creditors can continue all collection efforts and that is entirely legal. Interest and penalties continue to accrue on debt settlement enrolled debts. Creditors don’t stop charging those just because a consumer elected to send their money to Debt Free Angels instead of their creditor. And again we have the disturbing statements of repairing credit for a fee that create problems.
One their bankruptcy page they publish the following chart.
The chart appears to be full of dubious claims and statements. It also makes no mention of the benefits of a Chapter 7 bankruptcy.
But to run down the claims on bankruptcy:
Upfront money needed: Not true. many bankruptcy attorneys do accept payment plans for a Chapter 13.
Expected to pay: There is no expectation to be able to repay debt. It is determined by your income and liabilities. Homes, if you keep making payments, retirement accounts and other debts are off limits.
Effect on credit score: Chapter 13 is reported for seven years.
Ability to purchase car: Your interest rate immediately following bankruptcy may be higher but you can lower than with a larger downpayment and or letting time pass.
Impact on employment: The military actually looks at bankruptcy as the more responsible step since it is a legal process that addresses the debt.
I have not even addressed their column which is just as defective.
Overall the chart and claims made by the site are wandering into dangerous territory. It would seem that any consumer that errantly enrolled in the program and obtained a negative result would certainly have grounds for a claim of deception and misrepresentation.
According to the State of Texas there is no company registered to do business under the name Debt Free Angels.
Google shows the company is located here.
The property is described as “office warehouse. Approximately 40% office/showroom and 60% warehouse with HVAC throughout.” – Source
According to public information about Christina Randell, President & CEO she has, “been fortunate enough to now start 4 business that grossed over a million in their first two years.”
She was also the president & CEO of GreatBizSites Web Design. – Source. Since Debt Free Angels is listed using the same post office box as GreatBizSites, PO BOX 780367, San Antonio, TX, I’m left wondering if that is the corporation Debt Free Angels belongs to. But maybe my question was answered when I looked at the DebtFreeAngels.com domain name, which is actually owned by GreatBizSites Web Design and Christina Randell at 4337 Vance Jackson Rd, Suite 100, San Antonio, TX 78230.
GreatBizSites was cited by the FCC for making telemarketing calls to people on the National Do-Not-Call Registry. – Source
GreatBizSites, Inc. is actually a current and active Texas corporation. – Source
My advice, too many red flags, run away.