Collections & Credit Risk is reporting the State of Massachusetts is a step closer to regulate for-profit debt settlement companies operating in the state. Debt settlement companies would have to disclose their fees and create a budget analysis before enrolling consumers.
“The longer Massachusetts waits, choosing not to oversee this industry, the more consumers will be taken advantage of by these companies,” said Barbara Anthony, undersecretary of the Office of Consumer Affairs and Business Regulation, in a statement earlier this summer to a legislative committee.
Under the proposed bill, debt settlement companies would be required to post a bond to do business in Massachusetts. Violations of the proposed law could result in up to a $100,000 fine and prison sentence. Unlike an earlier proposal, which did not gain the support of the Massachusetts Legislature, the bill does not require any caps on fees that debt settlement companies can charge clients.
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