Debt Relief Industry

Financial Freedom Processing, Debt Consultants of America and Debt Professionals of America Post Press Release on Victory

A reader just brought this press release to my attention.


Federal Judge Rules in Favor of Financial Freedom Processing, Debt Consultants of America and Debt Professionals of America, Finding that the Federal Trade Commission Failed to Prove its Claims

DALLAS, March 21, 2012 /PRNewswire via COMTEX/ — In a stunning rebuff of the Federal Trade Commission’s (FTC) attack on the debt settlement industry, a federal court judge rejected the case against three Dallas-based companies. United States District Judge David C. Godbey of the Northern District of Texas delivered a verdict in favor of Financial Freedom Processing, Inc., Debt Consultants of America, Inc., and Debt Professionals of America, Inc.

Debt settlement companies, for a fee, negotiate discounted settlements with a consumer’s creditors after the consumer has saved enough money in a special purpose account to fund each settlement. The companies advertised that, through their programs, consumers can save 30 to 60 percent of their credit card and other unsecured debt. Upon completion of the program, usually in 36 months or less, the consumer will be debt free.

The Federal Trade Commission (FTC) complaint alleged that the companies’ savings and timing advertising claims violated the Federal Trade Commission Act and sought more than $58 million dollars in restitution. However, Judge Godbey found that the claims “were true for a majority of the customers of the Companies who completed the program.”

Bob Wise, of the Dallas law firm Lillard Wise Szygenda PLLC and the companies’ lead trial attorney, was pleased by Judge Godbey’s decision, pointing out that “the FTC failed to prove its case. To the contrary, as Judge Godbey found, the companies and their officers and directors used their best efforts to comply with the law and acted in good faith at all times.”

Corey Butcher, a founder and CEO of FFA, said, “Even though the FTC had no evidence of wrongdoing, the collateral damage from this meritless prosecution is huge: 300 employees lost their jobs, hundreds of thousands of dollars in revenue was lost, and thousands of consumers overwhelmed by debt were deprived of a viable option to bankruptcy. This is a gross example of over-reaching by a runaway government agency that has nearly derailed an entire industry.”

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Butcher continued, “Debt settlement companies fill a critical need that no one else is providing. Consumers need help in learning how to manage their spending and save money. When credit card companies raise interest rates on debt to 28 or 30 percent, consumers get caught in a vortex they can’t escape. Debt settlement companies help educate consumers and give them an opportunity to avoid bankruptcy and get their lives back on track.” Butcher concluded, “There was a lot at stake, and we’re thankful that justice prevailed in this case.”

Financial Freedom Processing is the Dallas-based parent company for Financial Freedom of America, Debt Consultants of America and Debt Professionals of America. The Dallas-based companies have helped thousands of clients settle more than 30,000 accounts, and eliminated more than $150 million in unsecured debt.

SOURCE Financial Freedom Processing

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Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

15 Comments

  • Why does it appear that FFD testimonials provide evidence they are operating illegally?

    “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;
     

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