Under the heading of “wow that was fast,” I’ve already received a response from the Federal Trade Commission to their recent loss in a Texas Federal Court in their case filed against Freedom Financial Processing, Debt Professionals of America, Debt Consultants of America, Robert Creel, Corey Butcher, and Nikki Creel.
In that case, which you can read more about here and here, the FTC claimed the debt settlement company was making deceptive and misleading consumer claims.
The Jude ruled against the Federal Trade Commission and felt that performance claims only need to be based on consumers who completed the debt settlement program, and not based upon the experience of all consumers.
You can read the courts ruling against the FTC at Court Issues Unfavorable Decision to FTC in Debt Settlement Performance Claims Suit.
According to Jessica Rich, Director of the Division of Financial Practices at the Federal Trade Commission, “We’re disappointed in the Judge’s ruling, and continue to believe that the defendants’ conduct is deceptive. We are considering all our options.”
Clearly this case is not over yet. More to come I’m sure.
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“Before Financial Freedom, I had tried on my own to consolidate my credit card debt. The combined payments were more than any other bill I had (approximately half my monthly income at that point and twice my rent). None of my credit card companies would take all the debt and none (of my credit card companies) would lower the rates. I was desperate. I heard about FFP on the radio and figured I’d give it a shot (better for my credit and cheaper than bankruptcy). The FFP staff was very helpful and was able to give me a clear understanding of the process. In a year and a half, I am credit card debt free. The process had its ups and downs, but just making one reasonable payment a month instead of three ridiculous ones, and then actually seeing the savings through the settlement process, was well worth it. FFP is an option that should be seriously considered. Thank you FFP.”- Jacques, Thibodaux, LA
331. Prohibition of debt adjusting when conducted for profit A. Except as otherwise provided herein, no person shall engage in the business of debt adjusting. B. As used in this section, the following words and phrases shall have the following meaning, unless the context clearly indicates otherwise: (1) “Person” means an individual, corporation, partnership, trust, firm, association or other legal entity.
“When I heard about FFP on the radio, I was behind on my credit cards and couldn’t afford the payments. It was getting worse and worse. Due to my divorce, I was getting further and further behind. I was struggling to make the monthly payments. At that time I felt I needed to carry the credit card debt just to live day to day. This was a problem that I needed to have taken care of. When I found out about FFP and that I could get a better payment arrangement with a better time frame for payoff, I was very excited. When the first settlement came through, there was a weight lifted off my shoulders and I knew this program would work. I had completed the program within 30 months. FFP is the perfect program for people in my situation who cannot do lump sum settlements and who don’t have time to deal with the creditors. I would recommend FFP to my friends and family.”- Jeff, Strasburg, CO
http://www.coloradoattorneygeneral.gov/sites/default/files/uploads/uccc/DMReport.pdf
not listed as a provider
“I got over my head in debt between job loss and things like that. I couldn’t make the payments anymore and I had to find an alternative to bankruptcy because I didn’t want to do that. I tried FFP and it worked. I heard the commercial on the radio and I thought I’d call to see what it was all about. I made the phone call and what they had to say sounded pretty good, so I signed up. Debt made me feel like I was just drowning and something was out of control I couldn’t get a handle on at all and it just kept getting worse. FFP’s customer service team was supportive – any questions I ever had, I called and asked and they answered. They told me to stick to my guns and that’s what we did and we came through. They did an excellent job. I was very surprised at the percentages they got on my final account. Now I have relief, which is what I was hoping it would be like – I don’t have to worry about my debt anymore. This process teaches you a little bit of a lesson. Afterwards, you look more in depth into things, not just at the surface – you look at the long term effects.”- Craig, Fairview, WV
§61-10-23. Debt pooling; definition; offenses; penalty; jurisdiction; pleading and proof.”Debt pooling” shall mean the rendering in any manner of advice or services of any and every kind in the establishment or operation of a plan pursuant to which a debtor would deposit or does deposit funds for the purpose of distributing such funds among his creditors. It shall be unlawful for any person to solicit in any manner a debt pooling.
“I think at first I was a little tentative because the process took a little while. When you want something to end as soon as possible, it can become a little nerve racking. I can’t say anything better about the people at FFP, you did exactly what you advertised. I think everyone was upfront with me and everything happened just the way they said it would. Everyone worked hard to get me the lowest rates that they could.”- Gerald, Akron, OH
(C)(1) “Credit services organization” means any person that, in return for the payment of money or other valuable consideration readily convertible into money for the following services, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, one or more of the following services:(f) A budget and debt counseling service, as defined in division (D) of section 2716.03 of the Revised Code, provided that the service is a nonprofit organization exempt from taxation under section 501(c)(3) of the “Internal Revenue Code of 1986,” 100 Stat. 2085, 26 U.S.C.A. 501, as amended, and that the service is in compliance with Chapter 4710. of the Revised Code;
Corey, in case you missed it, there are comments waiting for you over on this post. https://getoutofdebt.org/36911/financial-freedom-processing-debt-consultants-of-america-and-debt-professionals-of-america-post-press-release-on-victory
Any of the debt industry people here want to help this reader with some advice? Maybe we can divert some of the experience here to help this person. https://getoutofdebt.org/35900
Please post your comments on that post. The consumer will get them.
Dear All,
This article and ruling and commentary should be about the FTC action that went awry. Federal and State agencies typically only pursue cases that should be winners due to budget adherence and the goals of the political pressures on the agency. This time a Judge with adopted and assign Judicial powers ruled that the Company performed as promoted. It was a statement of fact not fiction.
What I read below is the typical bewilderment and badgering of a debt settlement company. Corey Butcher is continuing to fight the good fight and should be commended for having triumphed for what he believed in.
Corey- Live strong and Chive ON…
I agree. I think the fact that nobody seems to take responsibility for the harm done to more families than are helped, could be a big part of the reason the FTC is very critical of this industry.
Explain where the harm was done if a court decided that the claims were validated.
Supposed harm was implied but disproved. No Harm Here. If there was the court could have said “You didn’t lie” but you need to pay the people that didn’t get those benefits $150.00.
Damon,
This answers your question about what happens to the 60% that don’t complete. I posted it a couple of days ago but it does not appear that you read it.
“As for the 60% that fail or choose not to complete. Once again you have jumped to conclusions. Very large percentages that enroll never fund their account or pay fees. Additionally substantial portions of the 60% have many of their debts settled and choose to complete the process on their own. Others unfortunately have further hardship and cannot complete. This is where are largest amount of refunds go, which equals nearly 2 million dollars”
You mentioned above that you worked with a much respected company called CRN and you charged upfront fees. What is CRN’s success rate? How are your fees set up? My companies charged an upfront fee but collected a large portion of the fees after the accounts were settled. This incentivized our company’s to do the best job for our clients.
By the way I have never hid behind a screen name but I understand those that do. In this industry with the overzealous regulators and bloggers, you are only one sour grape away from an enforcement action.
Corey I did read it, and it is whipping a dead horse at this point. I was simply pointing out the fact that you take no responsibility for any of the failures. I found that very odd.
Nobody in this room will admit it, but we all know how the sales game works in this industry.
You are tired of doing your dance and I am tired of pointing out the fact that you are dancing. So lets just leave it at this.
A majority of the people that enroll in your program don’t complete it. I think we can agree on that point since the 60/40 number came from you. If a consumer wants to roll the dice with that, then that is up to them.
Yes, you did use your name and I certainly can respect that.
Notice I didn’t post anything about your past or that of your companies? I certainly could have but specifically chose not to go there. Hmm, maybe I am not as overzealous as you and the anonymous brood are trying desperately to make me out to be.
How many people complete chapter 13 BK? What percentage? Does the lawyer still get paid? Just like mortgages, cars, boats, or any other product the consumer is at fault. This is America not a socialist country. Just like the bottom line that a certain amount of people don’t finish the program you opened your couch business because you did not have the resources to enter this business and belong as an employee. Your attitude and know it all mentality does allow you to be employee because your mouth would get you terminated quickly. You service provides no value that can’t be found in 5 minutes on google or asking Steve a free question. None. You don’t have enough industry experience plain and simple.
Again I ask the question you had your own financial issues with not paying taxes so how can you claim to be able to tell others how to their handle their issues? You can’t. I don’t care how bad the companies are you are in no position to tell anybody how to handle their financial matters. You are simply not qualified to do so.
Was there a point in there somewhere Redstrom? Your argument is apparently everybody rips off consumers so therefore you also have a right to do it?
Let me guess, Captain of the Debate team?
You are right. This is America. You are free to rip people off (to a certain extent), I am free to tell them you are ripping them off, and they are free to make up their own minds about which one of us is completely full of Sh**.
I am secure enough in my intellectuality to speak with a consumer about their debt after they have talked to as many sales people as they want. Why do you not seem to have the same confidence in yours?
This is really a fascinating look into the inner workings of a typical debt settlement sales person. (Not saying they are all bad, but unfortunately most are just misinformed by management)
Even though there are no consumer complaints about me, you have no idea what my education, life experience or quality of advice is, you are so afraid of someone asking me for an opinion, that you don’t care how bad a debt settlement company rips them off. As long as they don’t talk to me, you could give a damn about what happens to them?
Wow, if that isn’t the most quintessential example of the mindset of the majority of people in this industry.
It isn’t important to help the consumer, the sale is the only thing that matters. Bravo
You might want to quit while your behind.
I have nothing to do with debt settlement and I think personally it should totally be stopped with credit counselling also. Make consumers responsible for their debts but there is too much money out there in credit card debt so it will not be stopped.
But again you did not respond to my question give one qualification you have to advise those in their financial time of need? You do not have one.
So I have a guy who had/has federal tax liens and said he needed to pay his bills and feed his family with the money. So you could not balance your family budget and live within your means. Now this same guy is going to tell me how to spend my money and how to be financially responsible?
A guy who won’t publish a phone number for his business and works off his couch. Let me give him money? What state is your company registered in? Do you have a telemarketing license in Florida? Let’s play do they comply?
You are just another shark in the water and are no better.
My Dear Redstorm1,
Let me see if I understand your philosophy on life.
What you are saying is that anyone who has gone through a tough experience and learned something along the way is automatically disqualified from later turning around and helping another person facing a similar situation.
Is this your philosophy?
Nope but somebody who acts like an authority and bully and has no qualifications at all do so is a snake. That is you 🙂
You have no qualifications at all to even suggest at happy hour something to do with money, nevermind pose as an expert and actually charge money.
I just think you are a cyber bully and you don’t respond to direct questions and just deflect when questions come to you.
Yes you say bad companies are bad… wow you are smart! Smoking gives you cancer …I just told you that but guess what is not make me a doctor and I don’t charge you for it. Like I said anything you tell a client can be asked for free on this site and looked up on google in 5 minutes. There is no value.
Well there again, consumers are perfectly free not to speak to me if they don’t feel comfortable. Of course I find it funny that you are proposing the alternative which is to call an 800 number offering debt relief, which is routed to a sales outfit filled with anonymous sales people and they are the ones that are going to provide good advice?
A consumer can certainly learn much more about me than they can from an anonymous sales person on the other end of a live lead call in wouldn’t you say? Of course they can also ask me any question they want during our phone call and if they don’t like my answer, just get a refund. Seems pretty harmless to me.
If you want to know more about me I will direct you to my website http://damonday.com
Spend a few hours reading and listening to some of the testimonies.
One qualification you have? Crickets
What can they learn from you that they cant learn here for free? Crickets
Oh, one qualification? How about a finance degree for 400 please alex.
So a degree in finance? Interesting what were you doing in 2006? How does a guy with a finance degree get himself into budget issues?
You just don’t have the background to advise people. Get your business registered in each state you do business. Get telemarketing licenses in the states and stop operating illegally.
Again debt settlement, credit counseling, and bk you have no qualifications.
What they can get from me that they can’t get on this site is an actual phone conversation with someone who can review their overall circumstances, run through their specific options and put together a detailed plan on how best to solve it.
Why are you so afraid of me?
This is hilarious. I am a cyberbully to an anonymous person slinging personal allegations at me. Ok, if it will make you happy we can pretend that makes sense.
I am perfectly comfortable letting consumers read what I have to say on my website and deciding if I am the guy they should talk to.
Accusations? You hide you phone number from public view , fact. You work from home, fact. You have had tax issues, fact. You have no qualifications , fact.
Do you have a telemarketing lisc in Florida ? Are you registered to do business in all states because I do not see you registered. Sounds like you are not set up properly and are in violation of many laws.
Uh, did you get all those facts by reading my website? I am very open about all that sherlock.
Redstorm I think I am going to hire you to do my PR. By the time you are done any person that reads this is going to have to head over to http://damonday.com to see just who in the heck this guy is and why is redstorm so hot and bothered by his mere presence 🙂
Swing away Merle
Redstorm, why does it bother you so much that my phone number isn’t on my website? It isn’t hidden from the public, it just isn’t on my website for reasons I stated earlier. Whenever I receive a consultation request, the first thing that goes out is an auto response with my direct email and phone number. This way my clients have my number and my assistant doesn’t get bothered by sales calls.
I am a little confused by you. You claim to not be in the industry, yet, you are spending an awful lot of time trying to attack me.
For me this is PR gold, which is why I take the time to do it. What is in it for you?
I just don’t like you … I am not in the industry you don’t have clients to steal or business to take. I just don’t like people like you a know it all loser who couldn’t make it and all they can do is tear others down. You just loved trying scare every debt guy out there and think you are some big shot. You are nobody you are some blow hard who works off his couch.
I don’t like you enough to start reporting you and all your satisfied clients to each state to make sure you are registered have proper licenses just to amuse myself.
The way you flip flopped on new era is just beautiful because you are just a puppet who changed his review because it was in his best interest.
So you can’t intimidate me with debt this FTC that it is not my business my area or anything like it. But steve did a good job backing into business with this site and I like the method and it can work for many other arenas.
While your ad is purely stolen for a beer ad. Classy shows your mentality and level for your own thought.
Wow and all this effort for someone that has no ties or interest in this industry and just doesn’t like me? Sounds like you have not liked me for awhile. Almost like, you certainly have been in the industry. But we wouldn’t know because you would rather hide in the shadows and hilariously enough do the very same thing you are accusing me of doing.
My favorite line is when you call me a “know it all loser”, and you just don’t like people that tear others down. I guess “know it all loser” is your way of building me up?
By the way, who exactly did I tear down? I couldn’t really tell around all the personal attacks that were being thrown at me for daring to ask a simple question about who is looking out for the consumer.
Well again, if a consumer cares enough they can read the opinion of anonymous Internet poster and they can read what I have to say and decide where they want to go to for advice.
Are you ok with that Redstorm?
Do you have any telemarketing licenses?
Are you registered to do business in every state?
No and No … you are operating against the law.
Again Damon I have or had nothing to do with the debt business, nothing.That is all you can come back to so you can deflect.
I am not building you up Damon I am also not trying to I am here saying
I don’t like your attitude and disposition so I am going to rip holes in you and your unlicensed and unregistered couch based business,
You were a kid who was picked on and most likely are mentally damaged that is probably why you are so abrasive. It most likely is not your fault but you are who you are and I am sure people have pointed it out to you before.
There is no point going back and forth about stupidity.
Let’s end it in three easy questions and if you answer them I will say I respect the fact you responded to them and drop all issues. The first two questions are just yes or no and nothing else is needed. The third is very simple and you should put it on your website.
1- Are you registered to do business in every state you operate? yes or no
2. Being a home based business that operates only on the phone do you have any telelmarketing licenses? yes or no
3. Please a give a brief summary of your qualifications to claim you are an expert in being able to guide those who are in financially distressed times? Because there is not one ounce of personal information about you on your site,
Do not double talk around this and that and give some long winded response, it should go something like this ……
No
No
None
Redstrom,
If I accidentally gave the impression that I was seeking your respect or approval I am very sorry. But I just don’t think of you in that way. Don’t fret though, I know somewhere out there is someone that is right for you. It just isn’t me 🙂
Now that the awkwardness is over, please help me understand your position.
Corey admits to shafting at least 18,000 people, I ask him about it, and you think the biggest threat to consumers is the fact that a guy working from home who has never had a single client complaint and does not engage in telemarketing activity does not have a telemarketing license?
I think it is clear that you know very well consumers should talk to me and it just pisses you off that you can’t think of a real reason.
At some point don’t we have to assume you are anonymous because you are lying about the fact that you are or at one time were involved in this industry and clearly the thought of me exposing your scams to consumers just pisses you off so bad that you drop everything you are doing and spend hours to attack me personally?
Redstorm,
As much as I admire your determination to try and debate an issue by avoiding the issue, I must say I agree with one of your anonymous cohorts. I can’t remember who it was, heck you guys are all probably the same person for all I know. However, I do agree that this back and forth moved passed ridiculous a long time ago.
I want to talk about issues and you want to take anonymous pot shots.
So it is really pointless to continue this in this thread. Of course if anyone wants to blame me for hijacking the thread take a moment to go back and read who actually has been taking all the personal shots.
Now, because you clearly have nothing better to do with your time then attack me, I wouldn’t want to just leave you with an immediate void in your life, so maybe Steve can start a new thread and we can title it something like.
Pissed off ex debt relief employees and owners who hate everything that Damon Day stands for and are so frustrated that they can never score a single point based on fact or common sense that they must attack him personally to feel better about ripping people off.
Ya, I think that is an appropriate title. Audios amigo, or amiga, whichever you are.
So by all this deflecting it is safe to assume you are operating an unlicensed business in each state and do not have any telemarketing licenses.
Thank you
I thought I clearly said I am not a telemarketer.
Speaking of deflection. I think there have been about 100 comments and nobody will answer my question.
So tell me please Redstorm, what is your opinion of a business where people pay thousands of dollars, 60% of them don’t get the results they paid the money for, and this is celebrated as a great success.
What is your opinion on that?
Damon I told you the business should be stopped and credit counseling too. Fees first or last they are all worthless.
But you need a telemarketing license in Florida you are in violation of the law. Also you are not registered in states too. You are just another guy in a business with no barrier to entry and that is the problem.
If you really discuss people’s options you need to discuss bankruptcy then you get in to unauthorized practice of law.
Again to me this is not about debt settlement or any debt business it is just about the way you conduct yourself. I am done with this banter. I am just going to go after you with the same vigor you after everybody else. You are not any better you are not properly licensed or qualified to do what you do. When the inquiry comes just know it was because of me. Toodles 🙂
Mr, Redstorm, you certainly are a strange bird, I will give you that. So this whole time, we both agree on this one fundamental issue and you still chose to attack me. Well, ok. At least we found something we can agree on.
Funny thing though, you claim you are going after me the same way I go after everyone else. Who did I go after personally? I think you might have gotten your streams crossed. Go read all of my posts. I wasn’t attacking Corey, I was attacking his business model. I never called him names or dug up his past even though a quick Google search on his companies left a Plethora of bombs I could have thrown had I felt inclined. All of the personal attacks were leveled by you and your anonymous friends.
But its ok, I appreciate the great PR.
Just an FYI, having a discussion with someone about bankruptcy is not a UPL issue. Whenever I discuss it with my clients I always then refer them to a local bankruptcy attorney.
C’est la vie
You guys are so busy going at me, you are not even reading my comments I guess. I didn’t say anything about the court. I simply pointed to the harm done by taking money from clients who got sold a program they should not have been in.
Damon,
Who, which clients were harmed? Name 3 of them. The judge didn’t find that anyone was harmed.
??? seriously? Do a quick google search
Or would you prefer for me to start pasting links to them?
Damon says:
“I know you haven’t caught on to this yet, but honestly I am starting to feel sort of bad. I mean it is just too easy to bait you guys into tossing up these softball pitches to me.”
Steve this is crazy and adds nothing to the discussion. In this thread Damon’s posts have been nothing less than bizarre!
This type of commentary adds nothing to your article and the others posting their comments and opinions…but this is your playground and if OK with you than so be it.
Funny. I asked a simple question about who is responsible for all the families that paid fees and never got a promised result, then I get anonymously dog piled on because nobody wants to actually address reality, and you are upset that I am enjoying myself while exposing a major problem in the industry.
How much value is added to this article with the anonymous comments taking swings at me? Or is that perfectly fine in your opinion?
I rest my case!
“Reality” today is not what was happening in the space a few years ago Damon. Reality today is things like this trial, the judge’s ruling and where we go from here.
Unfortunately there is not much for you to pick on with todays debt relief practices so spewing your old and tired retoric is all you can come up with…does this help drum up biz for you or something?
As fas as anonymous comments go…that is the nature of the beast (forums like this)…ask Steve if he will change this to protect you from future “dog piles” after your ridiculous posts and about “Likes”, do you think the “Likes” are votes by readers for either the guest/anonymous poster personally or yourself personally or could it be a vote by readers for what each of you are saying with your comments…uhmmm?
Well, I guess that just about sums up the main problem with the industry doesn’t it. You think it has been cleaned up and someone consumers aren’t getting taken for a ride anymore. Nothing has changed, it is just harder to spot, but it is there if you care to see it, which of course you don’t because that would hit your pocket book.
I don’t need protection from Steve. Dog Pile away my friend.
Are we really going to pretend that the likes received from any of the comments in here poking me are actually from consumers? Really. Ya, that is what happened. A random reader is going to waste his time reading all these comments, and “like” the ones that are anti consumer. Ya, I am sure that is what they are.
Damon, since you are a self proclaimed Financial Guru, how much experience do you have in the Debt Settlement Industry? I am always curious to know where you gained your expertise and if you have industry experience outside of your current business model of consulting. When did you get into the industry and what are your credentials to provide sound information to consumer who seek advice?
Funny, you demand to know more about me yet, you won’t even give me your name. Did I say something that would lead you to think I don’t have enough experience to know when a consumer is getting hosed? If so, please point it out and tell me why the statement is wrong.
I did not demand anything. I simply asked a question about your resume in regards to the debt industry. Put your gun in your holster and don’t be so quick to shoot. You are going to run out of bullets sooner or later and at that point, you are going to be eaten up. Its a pretty simple question. I wasnt aware that I had to reveal my identity to ask you how long you have been in the debt industry.
Doesn’t Damon Daze have a website for his services?
Steve do a “Does Damon Dazed website comply”
Who is this Damon Dazed? I would like to meet him.
Why yes I do have a website. Thank you for bringing it up. If any consumer would like an actual consultation about how to resolve their debts rather than a free sales pitch for something that has a 60% failure rate with CEO Math, (which means more likely an 80% failure rate)
They can contact me at http://DamonDay.com
Remember, I don’t discourage anyone from talking to sales people, I just encourage you to talk to me before acting on their advice.
Do you have a business address or do you work off your couch? What value does your service provide that 5 minutes on google or asking a free question to Steve does not provide? Do you have a business phone number? Not all people here who read this or comment here are bad business people who you call scammers. You my friend scam America by dodging your taxes and stating it was to pay your bills. So a guy who can’t balance his own personal budget is giving financial advise? You just attack everybody because when that light shines back on you it is not so pretty. You are just some guy on his couch sending clients to people who are in your circle. You hide without an address or phone number and if you were not in Steve’s circle he would rip you apart. You just try to turn everything around on people …I do nothing in debt, mortgage, or bankruptcy but read here because you can learn many opinions and how to run a business but you should learn how to just interact with human beings. You are no expert have nothing to back that you are an expert other than a friendship with Steve. I am done wasting any other time on this because you won’t listen but some day when you are without a job or friends in business because you burned every bridge you will wonder why. It is because of your attitude and overall disposition.
And there it is. We can’t refute what he is saying so lets try to go after him because he works from home.
Again, not to belabor the point, but is anything I actually say wrong? Or is trying to scare consumers from having a conversation with me and learning something the only thing you can figure out?
I don’t make millions ripping off families by charging thousands of dollars for a canned solution that won’t work for the majority of clients.
You are right, it is a lot harder to earn a living telling consumers the truth and offering real help for an affordable fee. Why do you think there are not very many people who do what I do?
I do have a business phone number and all of my clients have it. I took my number off my website when I was tired of getting bombarded with lead vendors and debt relief companies calling me to offer thousands of dollars per client if I would just refer them to what was clearly a rip off program.
Sitting on my couch? That would be foolish and bad for my back. I have a chair that I can sit on with a little desk and a light and everything.
I think a consumer can take 1 very valuable thing from this conversation.
I encourage consumers to talk to debt relief programs, then talk to me and make the decision after hearing another view point.
The people coming at me in this forum (Still wonder why they won’t tell you who they are) are so afraid of me talking to you, that the only thing they can do is try and scare you away from talking to me.
Which one of us do you think you should talk to?
Well, now I have made you aware. Perhaps I would like to know what makes you qualified to evaluate my experience and pass judgment on what I may or may not know?
Further, I am still waiting, is there something specific that I said that would lead you to believe I lack the experience to know when a consumer is getting ripped off?
If you can’t point to anything specific, I guess we can assume the reason you are asking these questions is because my arguments are irrefutable and you are grasping for something else in the hopes of throwing some misdirection into the conversation. If anything I said is incorrect in your opinion, the floor is yours, please refute away Mr. Interested Party.
If I recall correctly, you were gung ho back in 2008 to start a Advanced fee debt settlement firm. At that time, you didn’t know anything about the industry and you were looking to recruit someone to help train you and the staff you were looking to assemble so you could jump on the band wagon. I personally don’t have any bone to pick with you but what frustrates me about you is your ignorance to accept anothers opinion. You are quick to hype yourself and quicker to discount others. Believe it or not, there are other people that exist and operate in the space that have morals, ethics and true desire to help people but their model differs from what you believe to be the only viable way. It is admirable to believe in something as passionately as you do but at the same time laughable as you make yourself out to be a roach that feeds off degrading others. Sometimes, less is more. Think about it.
I know you haven’t caught on to this yet, but honestly I am starting to feel sort of bad. I mean it is just too easy to bait you guys into tossing up these softball pitches to me.
So Mr. Interested party who thinks he knows something about me but missed some key facts.
In 2008 I was working with a good friend of mine for a company he started Consumer Recovery Network. He has done some great things in this industry and if anyone would like to know how a true consumer advocate does debt settlement visit his site at http://consumerrecoverynetwork.com. I learned a lot from him and my time there really opened my eyes to how bad consumers get hosed when they are just looking for honest help.
In 2008 I worked out of my house as I do today and I can assure you that my wife would not be having any “staff” in the house. So you might want to check your facts.
Advanced Fee Debt Settlement Firm? If you recall in 2008 there was no advanced fee ban. What we were doing at CRN was creating a model to educate consumers about how they could negotiate directly with their creditors and save the thousands in fees that a majority of these rip off settlement companies were charging.
So before you go flapping your lips, you might want to check your facts. Even back then I was working with like minded individuals trying to figure out a way to show consumers, that these front loaded fee companies where you pay all the fees in 18 months yet have some BS 5 year plan was a horrible deal.
Funny Story. At one point I was talking to affiliates and sales organizations that were referring consumers to settlement programs. I naively thought that they would see how consumers could have a much better and less expensive option and want to refer them to us to better help the consumer. What an idiot I was. You wonder where I got my experience about the scams and cons that predicate this industry?
Let me tell you, there were very few honest people out there that would even consider telling consumers about our model. Take a guess why?
Come on, just one good guess??
Thats right, IT WAS ALL ABOUT THE MONEY. Why tell a consumer that CRN could settle their debt for only 900 bucks instead of the guy charging 6,000. Oh, that’s right, most sales guys sell the 6,000 upfront fee scam and pocket an easy 3,000 for their trouble. Everybody wins. Oh, except the consumer but that is their fault (seems to be the common theme I have gleaned from the folks taking shots at me here)
Corey brags about making millions with 60% failure rates, and somehow you want to make me the bad guy? Yup, that is about how it works in bizzaro debt settlement land. In this land, if a consumer pays 5,000 dollars to a debt settlement company and then gets their ass sued off by the creditor it is the consumers fault, and if any government agency looks at a company sideways it must be politically motivated. Ya, cause you guys are just flipping consumer guardian angels.
I never said there weren’t good people in the industry. There are a few. But that is the problem there are only a few that will actually put consumers ahead of fat pay days.
See the good news for consumers, is that I know who some of the good people are. I know who the two faced people are that only drop their front loaded programs when forced by law, not because it was screwing consumers.
I don’t think debt settlement is bad. In fact I recommend it to clients “when they need it.” Of course, I can teach them in 1 or 2 phone calls how to settle on their own, or refer them to someone that actually does things with their clients in mind.
That my friend is the difference.
Oh ya, if anyone wants to check out the company that my friend Michael Bovee started and who I was working with in 2008 when Mr Interested Party claimed I was out trying to get on the band wagon and screw people go to http://consumerrecoverynetwork.com
By the way, I don’t earn a commission for referring people to CRN.
Just thought I would state that for the record because that will be the next thing someone tries to come at me with.
Food for thought. Why is it that actual consumers never complain about my service?
Something to ponder.
Oh, I forgot. You said that you are frustrated with my ignorance to accept others opinions.
Ok, what opinion am I unwilling to accept?
I have voiced a disagreement about a program with a 60% failure rate being celebrated as a success. If your opinion is that this is fine, then you are partially right, I don’t accept your opinion because it is wrong. If you don’t agree, than own it and tell me why.
So far I get a lot of attacks for voicing a disagreement and nobody is able or willing to talk about the elephant in the room, why? Well, we really all know the answer don’t we?
I am perfectly willing to accept your opinion if you can show me where it has merit. What is your model and why is it good for consumers?
Simple question really.
Corey,
I noticed in the Judge’s opinion he wrote, “The Savings Claims and Timing Claim were true with respect to a majority of the clients of the Companies who completed the program.” But what percentage of enrolled clients completed the program and settled all their debt versus the number of enrollments?
I’m confused by the statement that the savings and timing claims represented the majority of clients so then it must not have been true of all completed clients. The ranges stated in the case were broad instead of a specific calculated number. Since you have such a good grasp on the numbers, what were the exact performance results by average and mean? For example, you say the saving percentage was between 40-60% but were most clients near 40% or 60%?
Now add in your statement in a previous comment, “The settlement savings or timing performance did not differ by active, completed nor discontinued clients.” I can’t get my head around the performance numbers being the same for all consumers. The only way that logic works is if you look at the individual creditor accounts and not in total per client. Was that your position?
I’d also be very interested in what guidelines you think debt relief companies should follow to give consumers fair, transparent and balanced information based on your experience.
I only thought my last response would be my last but I have to admit you have great questions. It almost seems that you are reading from the FTC’s hand book.
The numbers have no significant differences by client status, account by account basis or client by client basis. I know your next question as I could probably send the next four days asking questions for you and then educating you on numbers. So I will ask you a question, how do you include accounts not settled. Please don’t confuse with accounts that cannot be settled but simply accounts the company never had the ability to settle.
Since you are keeping score, I asked you earlier who is responsible for the completion the university or the student, the officer or the academy, the client or the trainer, the indebted or Dave Ramsey?
Last question, how many of your followers achieve their desired goals and is it your responsibility or theirs?
Corey,
I’ll answer these in reverse order.
I do not know how many readers achieve their goals. But then again, as I said before, I make no performance claims or sell any services.
There is work in motion now with the CFPB to make the graduation rates more transparent for incoming students. I recently wrote a piece about for-profit universities that were targeting returning soldiers. The VA publishes graduation rates for all students that enroll to give prospective students an idea at what percentage will actually graduate. A success rate type measurement. BTW, it was 28%.
My point of view is that it is important for the consumer to have transparency about what percentage of consumers before them achieved settlement of all or some of their debts and what percentage of total enrolled achieved those results.
There are other real life examples that are somewhat similar. For example, is it important for someone buying a used car to be able to know if the model they are looking at has a good safety record or recall history. It’s a material fact that can influence one’s decision to buy.
With a debt relief client, for me, it’s important for someone to know that if they are paying for a service that of the clients before them x% achieved the result advertised. If that number is 28% then it might give them pause before enrolling. But then again it would also serve to manage client expectations and help to deal with people unhappy later they did not get the perceived result.
Again, my opinion, it does not seem right to say we settle accounts at 40% when the reality is that only 35% of previous enrollees have settled only one account at 40% but only 10% of all enrollees settled all accounts at that percentage.
It’s just not possible to make an informed decision based on broad performance claims that do not paint the larger picture.
I actually wrote about some site last year that said their clients were 100% successful because they only included successful clients in the pool. For a level playing field, the guidance I copied off the FTC site not only helps to give all debt relief companies the operate to stand behind comparable numbers but the lack of such formulas just leaves any company performance claim in question and open to almost any regulatory action. As of now we simply don’t have any guide to define that if we are to claim the loss by the FTC throws everything in the TSR out the window.
And despite my requests, you’ve never answered my questions about performance with any specifics either.
My prediction is that the FTC and/or CFPB is not going to take this lying down and there will be more to come.
Steve,
I agree with your statements and if you look through the several responses I have written today you will see that I have answered your questions. The fact of the matter is a consumer survey was conducted and the reasonable consumer understood the ads and was not confused by the percentage range. Furthermore the FTC’s standard is that 50% plus 1 has to be able to achieve the results as advertised. The NARC also set the standard (which the FTC supports) that the upper limits of a performance claim must be achieved at least 10% of the time. We met and exceeded all of these standards.
At the end of the day what are the real complaints in the settlement industry? They are creditor calls, dunning letters, lawsuits and refund policy issues. The true flaw in debt settlement is the inability to protect the consumers while they are in the program. If the same protection could be given to the consumers as credit counseling or bankruptcy, in my opinion would reach much higher success rates. Think about it, settlement deals with the issues for these particular consumers. The main issue is the principle of the debt, which is reduced. The payoff is much shorter than the alternatives. It significantly reduces the outgoing monthly expenses. It does not have a long lasting affect on a credit profile. Settlement is not a public record. Last but not least, the program restricts the ability of a consumer to accumulate additional debt while in the program due to the negative impact on the credit.
The points you bring up were all points that were heavily argued in trial. Throughout the investigation, the discovery and the trial we produced over whelming evidence that fully disclosed to the consumer all the issues raised, which included completion rates.
I hope this long drawn out blog-a-thon has shed a little light on who we are as a company. I still welcome the opportunity for you to come to the office and see what are company is really about.
Have a great night.
Steve,
I agree with your statements and if you look through the several responses I have written today you will see that I have answered your questions. The fact of the matter is a consumer survey was conducted and the reasonable consumer understood the ads and was not confused by the percentage range. Furthermore the FTC’s standard is that 50% plus 1 has to be able to achieve the results as advertised. The NARC also set the standard (which the FTC supports) that the upper limits of a performance claim must be achieved at least 10% of the time. We met and exceeded all of these standards.
At the end of the day what are the real complaints in the settlement industry? They are creditor calls, dunning letters, lawsuits and refund policy issues. The true flaw in debt settlement is the inability to protect the consumers while they are in the program. If the same protection could be given to the consumers as credit counseling or bankruptcy, in my opinion would reach much higher success rates. Think about it, settlement deals with the issues for these particular consumers. The main issue is the principle of the debt, which is reduced. The payoff is much shorter than the alternatives. It significantly reduces the outgoing monthly expenses. It does not have a long lasting affect on a credit profile. Settlement is not a public record. Last but not least, the program restricts the ability of a consumer to accumulate additional debt while in the program due to the negative impact on the credit.
The points you bring up were all points that were heavily argued in trial. Throughout the investigation, the discovery and the trial we produced over whelming evidence that fully disclosed to the consumer all the issues raised, which included completion rates.
I hope this long drawn out blog-a-thon has shed a little light on who we are as a company. I still welcome the opportunity for you to come to the office and see what are company is really about.
Have a great night.
This shit cray…
In what way?
Wow, would love to see the attorney/firm which did this. The State/FTC doesn’t like to lose and expect some sort of Appeal. If they lose in Appeal courts, that would be even worse. The FTC may try to grind them out of business, ( A LA, Laura Udis in Colorado appears to be her tactic) and have them go broke, thus relying on a default judgment. But still case and precedent law now exist forever.
If I was this company, I would ask for a reasonable settlement and avoid court. If they decide to go to court, I would ask for the industry to help fund the battle as this would be a major victory for everyone left.
These things happen when states and agencies get overzealous with the laws. Mandates, privilege and resource doesn’t mean they are above the law, or even good lawyers. Wish more companies would try to fight the good fight. Many times agencies and states rely on “their” interpretations of the law, and become maniacs which leads them to risk of case law. But, they can move on from the agency if they lose, and try the private world, and have to become attorneys without the blanket the state/government provides them. I wonder if anyone at the FTC has any private experience and knows what it is like to pay rent late, or not be able to make payroll.
The FTC Rule is perfect, it did it’s job. I know someone from the FTC is reading this post, so please form a General Rule with the CPFB to govern what ever companies are left standing. A single application, that the States can help to enforce. The Debt Management complaints are down to 13, though tied into loan mods. Would love to know where they stand without being tied in…
Just an outsider, from a company that was shut down…
Paul,
We were that company that stood strong even though we had many including our counsel in the beginning that encouraged us to wave the white flag. I stood up because I knew the truth and like the old saying goes “the truth will set you free”. We are in the middle of planning a press conference that will expose all of the unscrupulous tactics and actions that were taking by the FTC throughout the investigation and lawsuit. In the FTC’s original press conference on the day they filed the lawsuit they called our companies scams and explained how we did little to nothing for the clients who enrolled. They then proceeded to parade 2 former clients out to validate their position. The sad part about this is the FTC had nearly 2 years before this press conference of full discovery through a CID that was served on the companies. They had all the information to verify if the former clients were accurate in their statements, which was brought to light during trial that little to any of the statements and claims the FTC and the former clients were an accurate depiction.
The hardest part of this whole process for me is that the FTC did not care to know the truth. They simply made up their position and had no interest in coming to the right conclusion. Instead they focused on nothing but winning. As an enforcement agency, shouldn’t the standard be to get the right result? I would hope so but that was clearly not the objective in this case.
As for the TSR, the FTC supplied no factual or extrinsic evidence in their support of the amended rule. The FTC also did the same in our case as the simply stood on the basis that we mislead consumers through deceptive claims because they said so. I am still bewildered by the fact that even though the FTC has consumer behavior experts and presumably spent hundreds of thousands of dollars on this case they never conducted a consumer survey. However, we did, and it is in my opinion so did the FTC but they would not release their findings because as our survey shows, the reasonable consumer is not confused by the ads.
In my opinion, we should expect more from our federal regulatory agencies. An agency should not target companies because they are the biggest player in the industry or they openly challenge regulators opinions. Regulators should be held to the standard to get the right decision and not just a “W”. I hope this sets a new tone in the agency and I further hope and pray that no individuals or companies have to endure this process as we did.
Corey
Corey congratulations and Bravo…I hope we can see your companies come back into the debt settlement industry and grow after this horrendous experience…consumers and the industry needs that.
Ya, they need that like they need a hole in their head.
Haha…you are such an A..hole!
Ya, I tend to turn into that when I see consumers looking for help and just getting ripped off instead.
I wear a cape with a big A on it. 🙂
Corey we would like to speak with you and get some commentary.
I sent you a message through LinkedIn.
Please send me an email
cbutcher@4ffoa.com
Cory,
To think that an Agency cares about an individual, employees or company is non-sense. They don’t care either way. Also to think that an Agency sues for violation of Law, is also non-sense. The idea that a State or Agency will be fair and not abusive is non-sense.
My advice, don’t hold any press conference; as negative attention never delivers any favorable outcome. Be bitter like myself and enjoy today as much as one can. And prey that there is other mad people in the world not afraid to be sued by the fortunate gene pool society….
Paul
Paul,
I must clarify that I am not bitter. I believe bitterness leads to revenge and I am not interested in revenge. I just want accountability. Accountability to vet out the truth and not have preconceived notations. That when you hold a hearing it is to hear both sides not just your side. That when you make rules that you consider who the rule protects rewards and destroys. That when an agency takes action what are the consequences to the company, employees, families, other business interests and individual reputations. I always knew that I would come out of this as a better person and I have. I have compassion for those who brought this action and hope they learned what damage they can cause when personal emotions get it the way.
Corey
Cory,
If you have been sued by an Agency, I am sure you are well aware of the frustration the bureaucrats create. It’s massively embarrassing for the FTC to lose anything. Now any suit (not just debt settlement, this is a major blow) of theirs that includes Truth in Advertising will always have motions that reference that case.
Some Ivy Leaguer with good genes is accountable. In their circles his/her name is done. Their career at the FTC is done. They will probably go into private practice and be eaten up as they are not a good lawyer, rather lucky winners of one of life’s uncontrollable contests. I hope other States and Agency’s have some pause when they sue, as too much case/precedent law will undermine any reason to be licensed, to make accurate claims, and or to be regulated. But these bureaucrats with no scars on their hands don’t see it this way.
How agencies drag people’s names into the papers is an abuse of power. Maybe after the fact, if a judge finds the person responsible. Again, these are symptoms of a back door mandate. Again, the agency isn’t suing for violations of laws, and don’t just use press releases to announce things. And if a company can’t afford to fight it, the agency sees a victory when the identified person has a default judgment and eventually enters into bankruptcy. For what? The consumer, oh my dear friend.
If the agency wants the industry dead, outlaw it, if they want a company dead, let it die graceful. If a company is committing fraud, and a judge agrees, let it be public record. Online reputation distortion is a key motivator for Agencies. It accomplishes so much. Whether or not if a state wins, and there is enough bad press, the company will eventually fold. Or worse, be forced to become criminal to more criminal. I like that the FTC doesn’t use press releases as much as some states do. But why shouldn’t a state do them, It’s not like they can be sued for slander, or extortion if someone is lucky enough to win a suit.
I am happy the FTC lost in this small capacity as it embarrasses them. But I am bitter, not revengeful.
Paul
Corey,
I was up all night thinking about these statements. I didn’t realize until late that you were part of this case. I would recommend not talking about this in a fashion like this, but I applaud your effort. I have lexisnexis and read your case. Brian Wise is surely going to benefit from this case. I was hoping not to see the regular lawyers who litigate in the debt settlement area. When the FTC takes this on appeal I will cut a private check to your attorney. You will know it is from me. I know you won’t respond, but going through this on the state level in a couple states some points really spoke out. I now track states and cases as a hobby. I understand that looking good is a full time job in a budget crisis, but why don’t these states just outlaw it.
Any state can pull anyone over and extort money out of a company, or have them go out of business for any reason. Its pay to play schemes most found from States in most licensing areas. Debt Settlement is not a popular industry and no one cares if a DSC cries foul to the bulldozing efforts of an agency. It’s really a perfect crime for states to generate money via fines, and re-elections via default judgments against an industry that really can’t count on the public support. The industry is at fault for not being able to rely on public support. There are several states like Colorado, Utah, etc and now Indiana that have figured this out. If I was a young buck at an agency I would send everyone and their mother a CID. States and agency can do this without cause. Regardless of licensing, laws, or relationships.. The flip side is that when agencies become overzealous they open themselves up to case and precedent law. Which if enough people fight, will ultimately undermine these agencies for years to come. Colorado and Indiana going after anyone for anything is a horrible way to approach this. There must be some sort of discretion when picking lawsuits. When an agency or state treats everyone the same they are losing. Their ego’s are such that it makes sense. It’s all really fun for me to watch. This isn’t about protecting consumers…
Paul
Sorry for ranting, these were the quotes…
“The hardest part of this whole process for me is that the FTC did not care to know the truth. They simply made up their position and had no interest in coming to the right conclusion. Instead they focused on nothing but winning. As an enforcement agency, shouldn’t the standard be to get the right result? “
This sounds like a first impression after getting sued. Most people don’t realize the bull shit that these bureaucrats do in these proceedings. In our situation we were fighting a couple people and their understanding of the law (no one else). And nothing else, really for no reason was there a fight. They could easily have helped us understood their ideas and made us better. Winning, mandates, press releases, looking good, and power has these bureaucrats all worked up.
They start getting a nice track record of pumped up wins and they believe they are the law, above the law, and even the best argument, they are the consumer as they are smarter, thus this is what the consumers want, regardless of any consumer asking. It’s fucking brilliant man.
The problem with you last question is the agency is not focused on what is right. Whether they admit or not. They are all motivated by other factors. In a perfect world they should be, but then they should use discretion on whose lives they ruin. If you took any of these gene pool kids out of the comfort of an agency, they would be nothing in a courtroom, they aren’t attorneys they rubber stamp lawsuits and expect you to run out of money (How is this a lawyer, and this isn’t how agencies used to be run).
That’s why I think the overzealousness and lack of being a lawyer is a perfect climate for companies to fight. Legal rights are not used by these agencies how they see fit, it’s up others… Your case is a perfect example. The FTC lost man, to a debt settlement company out of Texas. That is hilarious, they never lose.
“In my opinion, we should expect more from our federal regulatory agencies.”
Back in the day, A.G. Staff attorneys were the cream of the crop. There was a difference from being tuff, active, and thorough. Now a days they are evil and relentless. Why not work with industries of interest to provide better service, to provide better jobs, and a better economy. This comes down to budget crisis which creates entitlement, and a sense of power. These morons have never owned or operated a business.
“I hope this sets a new tone in the agency and I further hope and pray that no individuals or companies have to endure this process as we did.”
Won’t happen. If anything they will fight more. The gene pool society has no scars, and aren’t used to losing. If anything they will get more aggressive seeking their win to re-distinguish themselves as an attorney and not a reckless bureaucrat. And this overzealousness needs to be used against them.
“I must clarify that I am not bitter. That when an agency takes action what are the consequences to the company, employees, families, other business interests and individual reputations. I always knew that I would come out of this as a better person and I have. I have compassion for those who brought this action and hope they learned what damage they can cause when personal emotions get it the way.”
This hit home to me. Letting go my staff and them asking why was most difficult. These people may live pay check to pay check. May have disease, and so on. Them asking why in the world is this happening and having no answer is a horrible feeling. Them asking if we were frauds, and if the stories are true, is a horrible feeling. It resonates with one’s family. Now every time I get a job interview and my “past” comes up, it’s not good. For what, the bureaucrats who did this to me got nothing… I definitely believe that some agencies and states don’t have blanket mandates, but for those who do, which we got caught up in, the lack of discretion will ultimately undermine these morons. They don’t care about me, you, my former employees. They don’t have too, they shouldn’t. But it is morally reprehensible. It’s crazy, as it is night and day from the bad companies to the good, and which individuals are common criminals.
With the FTC making their perfect rule, they should now introduce a general rule that all companies need an application through them or the CFPB with state enforcement. Until then, a blanket approach by these agencies will look good for so long, then ultimately undermine their efforts and future efforts of these agencies in other arenas.
Off my latter.
Paul
Paul,
You and I have obviously experienced the same thing. The bad thing the vast majority of our neighbors, employees and families will never experience this. Because of this they have no reference and no true understanding. This is what is happening all across this country and why so many businesses are leaving our shores. You hit the nail on the head when you said “the regulators are no cream of the crop”. This may be the biggest understate of the century. I hate to stereotype a whole group but many of the regulators out their today are the rejects of their classes. They tried to get on with the large firms but never received an offer. Because of this it seems like the majority hold a grudge and turn everything into a personal grudge match between them and the large firms. As my lawyer explained to me “They feel as if they are doing God’s work”. I simply call it reckless.
I know that most people will read this thread and they will think it is sour grapes. However, if they will go read about the life of the Apostle Paul they will see what wrongful persecution is all about.
I have been walked in your shoes when you speak of the conversations with employees that you have to layoff. I have experienced banks denying loans because of the negative image of your reputation. I have had to shut down 3 businesses because of state licenses being denied because of this case. I have seen it, felt it and lived it. However, I have persevered and will be a greater person for it.
Paul,
You and I have obviously experienced the same thing. The bad thing the vast majority of our neighbors, employees and families will never experience this. Because of this they have no reference and no true understanding. This is what is happening all across this country and why so many businesses are leaving our shores. You hit the nail on the head when you said “the regulators are no cream of the crop”. This may be the biggest understate of the century. I hate to stereotype a whole group but many of the regulators out their today are the rejects of their classes. They tried to get on with the large firms but never received an offer. Because of this it seems like the majority hold a grudge and turn everything into a personal grudge match between them and the large firms. As my lawyer explained to me “They feel as if they are doing God’s work”. I simply call it reckless.
I know that most people will read this thread and they will think it is sour grapes. However, if they will go read about the life of the Apostle Paul they will see what wrongful persecution is all about.
I have been walked in your shoes when you speak of the conversations with employees that you have to layoff. I have experienced banks denying loans because of the negative image of your reputation. I have had to shut down 3 businesses because of state licenses being denied because of this case. I have seen it, felt it and lived it. However, I have persevered and will be a greater person for it.
https://getoutofdebt.org/34202/…
This was the post I was referencing.
Steve I think the reverse is what makes more sense. With respect to a
doctor. If doctors advertised there performance data only, the average
consumer would choose the best doctor. If a doctor said “6% of my
patients survive surgery” VS a doctor that said “90% of my patients
survive surgery” the patient would still see and have the ability to
choose which doctor to go with. However doctors and settlement
companies alike would still offer ethical and transparent disclosures.
Or at least in a perfect world.
With respect to other industries I think most industry’s are not being unfairly scrutinized by the FTC. A Judge recognized it.
As opposed to another industry let’s take a look at the FTC 2012
& 2013 Performance plan and look at only one item. At this
link…http://www.ftc.gov/opp/gpra/2013_perf…
Page 4 Measure 1.2.1 FY 2011 Actual – 100% success rate in resolving
cases filed by the FTC. In 2011 The FTC had ZERO carry over cases from
FY 2011 to 2012. The FTC is promoting their best data. Basically
saying any cases we had we completed. It would lead readers and the
public to believe the FTC wins all of its cases or reaches other legal
remedies. I also think the average consumer would need a few days if
not weeks to understand what the FTC proposed objectives and plans are.
Steve I agree that the fight isn’t over. The FTC could be winning
slam dunk cases against law firms on a daily basis charging up front
fees. There are a few of those on your site you’ve written about.
A few weeks back someone submitted a post on how to keep clients in the program and keep them happy and Steve agreed there is nothing that can be done.
That being said savings claims on clients that’s complete the program is pro-consumer. By pro-consumer it allows any consumer to choose a company that can get them the best results if they finish the program. Most consumers do not pick companies with results not in favor of the consumer if the service is rendered fully.
DSC 1. FTC 0.
Can you please provide a link to that post you mention.
It would be awfully hard to label only successful clients as a comparison. That’s like only promoting the winnings of lottery players without disclosing the odds.
Can you think of another industry where consumers are best served with only successful completion data?
Is that the type of fair and balance data you would want from your doctor before you underwent surgery? “Oh, the dead ones, they don’t count.”
In order to give consumers relevant information they would need the overall performance results and a subset of the final results obtained as part of that can be helpful when provided in context.
https://getoutofdebt.org/34202/what-can-we-do-about-customers-who-cancel-after-debts-are-settled
This was the post I was referencing.
Steve I think the reverse is what makes more sense. With respect to a doctor. If doctors advertised there performance data only, the average consumer would choose the best doctor. If a doctor said “6% of my patients survive surgery” VS a doctor that said “90% of my patients survive surgery” the patient would still see and have the ability to choose which doctor to go with. However doctors and settlement companies alike would still offer ethical and transparent disclosures. Or at least in a perfect world.
With respect to other industries I think most industry’s are not being unfairly scrutinized by the FTC. A Judge recognized it.
As opposed to another industry let’s take a look at the FTC 2012 & 2013 Performance plan and look at only one item. At this link…http://www.ftc.gov/opp/gpra/2013_performance_plan.pdf
Page 4 Measure 1.2.1 FY 2011 Actual – 100% success rate in resolving cases filed by the FTC. In 2011 The FTC had ZERO carry over cases from FY 2011 to 2012. The FTC is promoting their best data. Basically saying any cases we had we completed. It would lead readers and the public to believe the FTC wins all of its cases or reaches other legal remedies. I also think the average consumer would need a few days if not weeks to understand what the FTC proposed objectives and plans are.
Steve I agree that the fight isn’t over. The FTC could be winning slam dunk cases against law firms on a daily basis charging up front fees. There are a few of those on your site you’ve written about.
Thanks for the link. It appears that actually what I concluded with in the article you mention on client retention is “If anything was a deciding factor I’d have to say it would be speed of response, quality of response, and professionalism of your staff. Those are important factors you can control and should.”
While I know it may feel like the FTC is only or primarily targeting the debt settlement industry, if you look at the total of their actions that would be a difficult statement to support.
As for the FTC performance data you cited, I read it differently. It actually says “The percentage of all cases filed by the FTC that were successfully resolved through litigation, a settlement, or issuance of a default judgment.” the specific cell on that page appears to be talking about cases filed in 2011 that have reached completion in 2011.
Steve,
I clearly disagree with your point of view. I do believe that success rates of a company should be made available but the performance of a company has to be considered by the service they offer. For example, using the FTC’s example, if a consumer purchased diet plan that required the consumer to take 30 pills in 30 consecutive days in order to lose 10 pounds then the company has to be able to substantiate that claim. However, does it have to include the consumers who on day 15 quit taking the pill? In the FTC’s position they stated that the reasonable consumer obviously knew that they had to complete the 30 day program to get the results. In the FTC’s next statement they explained how the companies are different, how? If the typical consumer signs up for an 18 to 36 month program but only completes 6 months how can they expect to achieve the result. However as we proved, if you stick to the program not only will you timely complete but the debt will be reduced as advertised.
So I ask you Steve, how can a company be held responsible for a consumer who does not complete the process? As I pointed out in my previous post nearly year and half ago, we have completed thousands of clients and reduced their debt as promised. It is a result that can be achieved but like all other participation programs, you have to complete. It is no different than a degree plan. How many young Americans start off embarking on the vision of being a lawyer, accountant or doctor but through no fault of the university fail to achieve their goal. Whose responsibility is it, the university or the student? Please let me know how you hold the university responsible and how this differs from the companies in this case.
Corey
Excellent question. I have to return to my old medical days to answer.
Before any patient had surgery we had to go through a comprehensive informed consent process to let the patient know about all of the consequences and possible outcomes.
Your diet pill example is interesting but not relevant in the bigger picture of what is the likelihood of success if I embark down this path.
I agree, consumer purchasing some diet supplement or weight loss plan that claims a performance claim should be required to state the claim in light of what the average purchaser received.
In the medial example, it did not matter if the patient died from not following directions or had a horrible diet. The outcome of the procedure was based on if the patient received the benefit the surgery was intended to address.
So just for clarity, what were the performance results of all consumers that entered your program versus just those that completed it?
How many readers of your site become debt free?
The answer to that would parlay to “If other sites help more people get out of debt more than yours how could you be the best site for help with getting out of debt by MSN Money”. That would then parlay to who made the more misleading claim MSN Money that your site is the best or your site saying your the Get Out Of Debt Guy when someone else could be the real Get Out Of Debt Guy.
Not everything always aligns correctly or is interpreted correctly. I think a court ruling of the claim being warranted is not for debate. Half a million dollars was most likely spent by all parties and the judge decided they did what they advertised. Hard to refute.
Not really apples to apples.
1. I make no performance claims.
2. I do not charge any fee for any service.
As far as how Liz Weston at MSN Money came up with the sites that were included or any order, you’d have to ask them. I’m the recipient of the honor, not the creator of it.
There really isn’t any reason for us to bicker about this. The odds are pretty significant that the FTC or CFPB will follow up to get some clarity. Using the recent decision as some indication that it is “game on” would be a mistake.
The decision is as I reported it but it does not mean it is a final decision in this matter when it could be appealed or pursued by others.
I look forward to covering the press release by Butcher as well as any future updates in this issue.
Except for the Half of million dollars. Try 5 to 6 times that amount.
The settlement savings or timing performance did not differ by active, completed nor discontinued clients. However the FTC contended that you must include accounts not yet settled and includes clients who dropped out. Meaning that if a client dropped out in month 6 you must include them in your timing claims. So if you have 100 complete and 1 incomplete what is your timing claim, you can’t make one because the 1 equals infinity or never completes. As for the settlements, all settlements were always included but how do you include debts not yet settled? The FTC positioned you must give a 100% value to those that are not yet settled in the values of the settled accounts, which is completely counterintuitive.
The health care comparison you make is absolutely true. When the first proposed consent decree was presented to us it contained an additional count of failure to disclose. Which what the case was primarily turned into and the Judge concluded that the companies always operated in good faith. We have several of layers of disclosures that fully and completely inform the consumer of the risks of debt settlement. This was validated by the FTC’s own under cover mystery caller and the adverse former clients that said they fully understood the risks. The former clients were merely upset that they didn’t receive a full refund. This has nothing to do with the claims nor is it unlawful not to offer a refund.
I’m not clear on what you are feel is the current best practice when it comes to citing performance claims for debt relief services.
Just for clarity. Are you saying that the guidance the FTC offers specifically about this issue is not relevant when they give the formulas as:
State the savings based on the customer’s debt when he or she signs up for the program. You may not inflate savings figures or percentages by including interest and fees the credit card company adds after a customer signs up for your program.
Example 8: Andy signs up with a debt relief service offered by Company H, owing $10,000 on his credit card. One year later, following negotiations with the credit card company, Company H negotiates a settlement allowing Andy to pay $6,000 to resolve the debt. However, since Andy enrolled, the credit card company has charged him interest and late fees totaling $2,000, so that Andy now owes $12,000. By getting a settlement for $6,000, Company H has saved Andy $4,000 ($10,000 minus $6,000) or 40% of the debt at the time of enrollment. It would be deceptive for Company H to claim to have saved Andy $6,000 ($12,000 minus $6,000) or 50% of his debt.
Include the impact of your fees on the claimed savings. You may not inflate your savings claims by excluding the fees your customers paid you.
Example 9: Betty owes $10,000 on her credit card, and signs up with Company J’s debt relief service. Company J gets a settlement allowing Betty to pay $5,000 to resolve the debt. However, at the time of settlement, Company J charges Betty a $1,000 fee for its work. It would be deceptive for Company J to claim to have saved Betty $5,000 – or 50% of her debt – because Betty also had to pay $1,000 in fees. Instead, Company J may truthfully state Betty’s savings as $4,000 ($5,000 minus $1,000) or 40% of Betty’s debt.
In calculating the results you’ve achieved over time, you must include customers who dropped out or otherwise failed to complete the program. Don’t base your savings claims only on customers who successfully completed your program.
Example 10: Company K had 10 customers signed up for its service. Each one had $10,000 in unpaid credit card debt for a total of $100,000. Five of the customers completed the program, and each saved $5,000 – for a total savings of $25,000. The remaining five customers dropped out of the program, each one still owing the $10,000 they owed when they signed up with the program. Taken together, Company K has saved its customers $25,000 – or 25% – of the total $100,000 debt they had when they signed up with the program. It would be deceptive for Company K to exclude the drop-outs and claim that it saved its customers 50% of their debt.
Include all debts enrolled by your customers, not only those that have been settled successfully. In calculating your savings claim, you may not exclude accounts you failed to settle, even if the failure was due to customers dropping out of your service.
Example 11: Company L has 10 customers, and each of them enrolls two $1,000 debts in the program – totaling 20 debts or $20,000. Company L is able to settle 10 of the 20 debts, each for $500. However, it was unable to settle the remaining 10 debts before those customers either completed or dropped out of the program. Thus, Company L has saved its 10 customers $5,000 or 25% of their debts in the program. It would be deceptive for Company L to exclude the 10 accounts that weren’t settled and claim a savings rate of 50%. – http://business.ftc.gov/documents/bus72-debt-relief-services-telemarketing-sales-rule-guide-business
Steve,
You surely must know that all of the examples were given in the trial and we substainated the claims under all examples.
I think you might want to apply for a position with the FTC because it seems you would make a great fit.
Respectfully
Actually I surely don’t know that.
So what was the performance difference between all enrolled and those that completed the program. The number can’t be the same and I don’t think you answered my question when I asked it previously?
Since this was all covered at trial, what were your actual performance numbers?
Also, you didn’t answer my question about if you felt the FTC performance measuring formulas were not relevant in light of your case.
Steve,
This will be my last post as I am now convinced that you cannot see through the jaded visions of your own arrogance.
Our success rates are in an answer to Damon’s response.
As for if I agree with the FTC’s performance formula, they actually never came presented a logical formula. Both their economic expert and ours agreed that the way we did it was indeed the correct way. The FTC gave no latitude to their economic expert other than follow their narrow scope when examining the data. Obviously the Judge did not buy it.
Stating my Lawyer, The FTC simply made it up and felt that because they felt that it should be so, than it should be.
Steve you must understand one thing. I did not enter this industry for profit. I already owned two successful businesses in the health club industry. I entered the industry because I understood what it was like to be burdened with debt. I grew up watching my parents losing cars to repossession, being evicted from rent homes; have to rely on food stamps and free lunch and most importantly watching my mother work 2 and 3 jobs. I know what it is like to struggle and I know what it takes to succeed. In order to succeed you have to get tired of struggling and start doing something about it. Debt settlement is just that. It’s not easy, it takes commitment, it takes determination and it takes persistence. Once you complete, the accomplishment is yours. Through the process the client learns how to budget, learns to live within their means and more importantly learns how to save.
I believe the biggest compliment to a company is when a current or former client refers a friend or family member. We ceased enrolling new clients nearly 2 years ago but we still get anywhere between 20 and 30 referrals per month. The sad thing is we have chosen to decline offering any service to these financially distressed consumers.
Corey you conveniently left out a key point. Who is responsible for evaluating a consumers circumstances and enrolling them into your program? Who determines whether or not a consumer is mentally and financially prepared to be successful in your program?
Great Question and it is easily answered, the company. As we proved only 12% of all the people who contacted our compnay were accepted into the program. Even with that out of the 30,000 clients a few slipt in by falsely repersenting themselves or situation. However, whenever this occured and the company became aware we took the neccesary actions to either term the agreement and/or refund the fees charged.
Interesting. So what you claim as the percentage of people “accepted” into your program just happens to be about industry average closing ratio? I love sales guys.
So lets pretend anyone reading this believes that your commissioned sales people told 88% of their leads that they were not allowed to sign up and still had a job the next day. (Ya, that is totally what happened).
So if I follow your logic. Almost all of the people you enrolled were stringently screened and qualified right? Then except for the few consumers who lied (as you claimed) your success ratio should be off the charts correct?
And since your completion rate was so high, what would it matter if you include just those measly few people who slipped through the cracks into your overall success ratios?
“He once had an awkward moment, just to see how it feels.” – He is the most interesting man in the world.
I think I am starting to understand now.
Advertisement:
100% of our clients are successful*
**********************************************************
Fine Print:
*Statistic does not include clients who were not successful.
**********************************************************
Ding Ding Ding. We have a winner. Tell em what he’s won Bob!
For his clear ability to parlay a meaningless phrase into something that sounds very impressive…
The Most Interesting Man in The World has now qualified to put a USOBA badge on his website. (applause).
Love me or hate me, that was funny.
Damon,
I love your sarcasm but you are distorting the truth. I love guys that are self proclaimed personal financial consultants but don’t have two nickels to rub together.
Our screening process eliminated about 30% of all the people that called initially for several reasons
1. Not enough debt (because it wouldn’t benefit the consumer)
2. Wrong State
3. Wasn’t debt that we could work with
Another 30% was eliminated through to intake call.
1. Recent balance transfers
2. Couldn’t afford the program and was forwarded to an attorney for bankruptcy review
3. Had to many assets
4. And several other qualifying factors
Another 20% eliminated themselves due to the risk such as adverse effects on credit or possibility of lawsuits. The remaining was eliminated by our review board process because of unsupported income, to many high risk accounts or other circumstances that would make it a successful program.
As for the completion rates, it is roughly 40% of all the clients who enroll. Considering how knowledgeable you are in the debt space you know this greatly exceeds the other alternatives that are out there, such as credit counseling at 20 -25% and chapter 13 at 8 – 12%. Of course you can also look at the success rates of snow balling or the avalanche strategy, which is less than 2%.
So with you superior knowledge please tell me what is the best solutionn for individuals to eliminate thier debt with no negative montly cash flow but have to much income or assets to qualify for bankruptcy and can’t afford credit counseling or make minimum monthly payments?
Please post your response so you can start helping financially distressed americans and not just those that have the ability to fund a IRA or a 401k. I am sure you know plenty of those people because they are the ones that you sell and how you make your comission.
Oh, this is going to be so fun.
You really want to knock me because I haven’t made millions ripping off consumers? That is where you want to take this conversation?
Better get your PR guys out of bed before you step in it any further.
Damon,
You know little about me. I currently own multiple businesses in many different industries. I agree that I may have taken your bait to make this more personal but I have set on the sidelines for more than 3 years while my name was trashed. I understand if you were offended but you should resist throwing stones because they might get thrown back.
I am not ashamed of my successes and have learned from my failures. I am slow to criticize or pass judgment. For I know that everything has two sides and the reality usually resides in the middle. I have to admit that I am biased when it comes to debt settlement because I know exactly how it works. I also know there are other alternatives that can be very successful.
As for the 60% that fail or choose not to complete. Once again you have jumped to conclusions. Very large percentages that enroll never fund their account or pay fees. Additionally substantial portions of the 60% have many of their debts settled and choose to complete the process on their own. Others unfortunately have further hardship and cannot complete. This is where are largest amount of refunds go, which equals nearly 2 million dollars
You are right. I know nothing about you. Everything I said was based on your comments in this forum and if you review, you will find that nothing I said was about you personally and instead was specifically targeted to your expressed point of view. (which clearly I disagree with.)
You chose to take a personal shot at me and then quickly realized it was going to back fire. I certainly wasn’t offended by your comment. In fact I expected it.
So, now that we have that cleared up. Back to my original point. I asked who was responsible for enrolling the consumers. You answered that the company was, and then proceeded to blame the consumers for your 60% failure rate.
Do you or do you not take any responsibility for the 60% of your clients who paid you money and never got the promised results? If so how much?
What percentage of people do you feel dropped out of the program because they really should never have been signed up in the first place?
Damon,
Read the threads above and I answer your question. We as a company tried to do everything for those who struggled to stay with the program. We have many areas of assistance to help people with further hardships after enrollment. For the clients who we had lapses in service, we did everything within our power to make up for the service error.
As the Judge stated, we always “acted in good faith”. Which in laymen terms, we ran a legitimate company and offered a legal and legitimate service.
Corey,
You asked me to use “my superior knowledge” and tell you what the best solution is for a consumer that can’t qualify for chapter 7 bankruptcy and doesn’t have enough monthly cash flow to afford a credit counseling program.
I am glad you asked.
The answer is, there isn’t “1 solution”
The best thing for the consumer is to speak with someone that can use critical thinking skills, take the time to evaluate their individual situation and put together a plan that takes into account all of the various circumstances.
I assume you do not need me to explain to you the almost infinite number of different circumstances that individuals can potentially be dealing with in their own personal and financial lives?
Putting every single consumer that can’t qualify for a chapter 7 and can’t afford a CCCS program into the same box and offering the same canned solution is a great way to make millions of dollars, but clearly not a great way to help very many people, as evidenced by your 60 percent failure rates.
But that is just the lowly opinion of what did you call me? Oh ya “a self proclaimed financial consultant that doesn’t have two nickles to rub together”
Corey,
I know you moved mountains to keep people on your program. That is where you get your money. Keep the poor suckers on the monthly program as long as we can.
Are you just not going to admit it, or do you really believe that every single one of those 18,000 clients that bit the dust should have definitely been sold into your program?
Damon,
You obviously love to write but please stop and read my responses. I have answered all of your questions. I know I cannot convince everyone or even educate them because YOU have to be willing to become educated. The fact that out of more than 30,000 clients have been served by our companies and not one former client that testified supported the FTC’s position, speaks for itself! You can pass judgment as the FTC did but I will let the courts speak for me.
Good luck in your future endeavors
Ok, from all of your non answers to my one simple question, I have only been able to conclude that you assume no responsibility and if a consumer is unfortunate enough to fall for your sales pitch while foolishly thinking your sales people are actually looking out for them, that is their problem.
Help me wrap my head around the fact, that when your program works as designed 18,000 people still didn’t get what was promised. How is this a good program? Under the best case scenario you get an F?
I am not familiar with the case, so I can’t comment on what the judge said.
I will leave you with this, just because something might be legal, doesn’t make it right.
way to go Damon…you have proven your ignorance. the saying ‘give a person enough rope and they will eventually hang themself” has proven itself today. you are a buffoon! a simple tally of the “likes” of posts on this forum should educate you somewhat on what readers here really think of your insights.
Could you provide some specifics please? A tally of anonymous likes in a forum filled with debt industry people doing the same thing you are is how you claim victory in a debate? Bahahaha. How sad that must be.
I don’t write to make friends. I focus on telling people the truth even when it makes me the least popular guy in the room.
Again, please give me a specific about something I said that is incorrect. Be warned though, I will bring my friends Mr. Fact and Mr. Reason to the party.
If you want to take a shot at me, why not have the courage to do it with your real name?
You know who I am, stand up and tell me where I am wrong please. I look forward to it.
Damon, I’m not claiming a victory in any debate with my earlier comments, just posting my thoughts, again way to go figuring things out Damon.
Specifics? Here you go in typical Damon fashion, asking for specifics, wow so predictable. Everything you say is incorrect Damon!!
If you really want all posts to include real names you should ask Steve to change the dynamics of this forum to only allow pre-screened commenters and moderated posts, this won’t happen as this is not good for the business of Steve’s blog.
I’m sure I’m not the only one who believes that you post here anonymously when you feel it benefits you and you post as Damon only when you choose.
If you don’t think the “Likes” function adds anything to what commenters post you could ask Steve to remove this function too.
Yes, you caught me, I like to ask for specifics. How very devious of me :-). I could just stick to anonymous general accusations, but you guys have that pretty much covered.
Me post anonymously? You mean when I post something that is controversial and I know people are going to attack me for it? Is that when you think I supposedly post anonymously? Ya, cause it is clear that I am totally afraid to speak my mind.
So, if you are done ineffectively dodging my question.
Can you actually point to something I said that you don’t agree with, or are you just taking a poke at me because you are frustrated and just want to feel better?
yes you caught me,
I am frustrated but I do feel better!!
http://youtu.be/quyB8PMTD3o
Steve, the surgery analogy is poor. Because, the FTC is wanting to include EVERYONE who does not complete. So, that would be like including people who stop taking treatment in the success ratio. OR, requiring a physical trainer to include all the people who stopped working out in his advertising claims for pounds lost.
In order to give consumers relevant information, you could supply them with the information for those who have completed and the # who have dropped out for whatever reason.
Before all the yahoos start coming up with all sort of crazy savings claim creatives, know this: This case didn’t involve the violation of the TSR; it was a pre-TSR case (the alleged illegal conduct occurred back in 2005-2006) that only dealt with Sec. 5. I’m not sure how the court would rule if it had to apply the TSR.
Excellent observation.
Yes you may be correct that the amended TSR was not challenged.
However despite any TSR violations the judge still ruled that performance claims can be made on the clients that complete the program.
That is damaging to FTC cases nationwide and CID efforts to root out bad actors.
I agree it is damaging to the FTC and they are not going to let that stand. Expect more to come.
YOU WROTE: “you may be correct that the amended TSR was not challenged”
No, i AM 100% correct that the amended TSR was not challenged. This is plainly evident from the opinion and all the pleadings in the case.
YOU WROTE: “despite any TSR violations the judge still ruled that performance claims can be made on the clients that complete the program”
The judge never examined performance claims under the amended TSR. The fact that the court determined that those performance claims did not violate Section 5 of the FTC Act, does NOT prove that such performance claims don’t violate the amended TSR.