Quick Answer: Canada is implementing strict regulations to eliminate debt settlement scams, with Manitoba banning upfront fees and capping settlement charges at 10% of debt owed. Alberta has similar protections limiting fees to 15% of monthly payments and 10% for final settlements.
Dear Alberta and Manitoba,
Damn, that was fast.
Steve
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I suppose it sure didn’t hurt have the entire FTC Telemarketing Sales Rule process done and dusted, but Canada is acting quickly to ban advanced fee debt settlement companies.
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New regulations in Manatobia are effective in 12 days will prohibit any advanced fees charged to consumers before settlement and will limit fees to 10 percent of the debt owed.
Healthy Living, Seniors and Consumer Affairs Minister Jim Rondeau said, “We want to be sure that people already struggling with debt don’t find themselves paying large fees upfront with no guarantee the service will actually reduce their debt. Some consumers have found themselves worse off than before signing up for debt settlement.”
The swift action by Manitiba follows regulations by the province of Alberta that proved to be effective is curbing abuses as well.
In Alberta a debt management company can charge a one-time administration fee and if payments are made monthly a fee can be charged that is not more than 15 percent of the payment received from the consumer for distribution.
But settlement fees are limited to a single fee of no more than 10 percent of the debt owed. – Source
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