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FTC Cracks Down on Debt Settlement Company

Posted By || 1-Feb-2013

The United States Federal Trade Commission (FTC) recently stopped the allegedly deceptive practices of a debt settlement company, FDN Solutions, LLC. This company purportedly hooked debtors with exaggerated claims about how it could help reduce their debts. The company claimed in its advertisements that it could reduce consumers’ debts by 40 to 60 percent. The FTC alleged that the misleading claims did not take into account consumers who dropped out of the program or the fees that the clients paid (which totaled 30 percent of the savings achieved).

The company operated from offices in Tustin, California, and Tampa, Florida. The company used third-party websites to advertise its services. These ads stated things such as, “Reduce Debt 70% Want Proof?” and “Save up to 70% On Credit Card Debt.” Once consumers called the toll-free numbers, the company allegedly misrepresented the amount of money or the percentage of the debt amount that a consumer could actually save by using the company’s services. Other allegations concerned fake customer testimonials.

The settlement order imposed a judgment of $3.3 million. Once $85,000 is paid, however, the remainder of the judgment will be suspended based on the company’s inability to pay.

Consumers who are struggling to pay bills may need the advice of an experienced attorney to figure out what to do. A fly-by-night debt consolidation company does not have your best interests in mind. If you’re falling behind on bills, a Chula Vista attorney can tell you if filing for bankruptcy is the best option for you. Call Kerry Denton at Southbay Bankruptcy today to find out more: 619-458-3739.

Categories: Chapter 7 Bankruptcy