ATTORNEY GENERAL WARNS FLORIDA ABOUT CREDIT REPAIR & DEBT SETTLEMENT SCAMS
Continuing the message of National Consumer Protection Week, Attorney General Bill McCollum today issued a consumer advisory warning Floridians about scams related to credit and debt issues.
Companies offering credit repair solutions or debt settlement were among the top concerns reported to the Attorney General’s Office last year. The Attorney General noted that, given the current economic climate, disreputable companies will likely continue to prey on consumer’s credit and debt concerns.
“Consumers who are seeking legitimate assistance are being deceived and often required to pay substantial up-front fees that put them even further in debt,” said Attorney General McCollum. “My office is working hard to deter these companies from engaging in deceptive business.”
Credit repair schemes usually involve claims to improve credit scores or eliminate bad credit and are sometimes part of other operations claiming to negotiate or erase debt. Consumers need to be cautious of firms offering credit relief, including debt management, credit counseling and credit card rate reduction services.
Debt settlement scammers promise they can pay off consumers’ debts for a fraction of the amount owed, but instead collected large up-front fees and leave customers with little or no money to pay creditors. Consumers should avoid companies that make outrageous promises and collect up-front fees before providing services.
Debt collectors are another area of concern for consumers who are struggling with credit and debt issues. These companies often harass or even threaten consumers in an effort to collect money owed. Debt collectors are legally prohibited from misleading consumers or threatening them to collect payments. They are also prohibited from calling after 9:00 p.m. and may not contact consumers at work if they know the consumers’ employers disapprove.
The Attorney General has been working closely with the Florida Senate to address several of these issues, and Senate Bill 1702, a proposal by the Senate Banking and Insurance Committee, is scheduled for hearing next week. The legislation includes the Attorney General’s suggested language for expanding the Office of the Attorney General’s authority to pursue debt collectors. Specifically, the bill will make certain debt collector practices a violation of the Florida Deceptive and Unfair Trade Practices Act (F.S. Ch. 501 Part II), providing a clear basis for pursuing civil litigation. This new tool would give the Attorney General enforcement authority over all entities covered under the act and provide for stricter penalties and broader relief for consumers. The bill also includes provisions for addressing credit relief and debt settlement scams.
The Attorney General offered the following tips to avoid being scammed:
- Avoid organizations that charge up-front fees for information.
- Get a specific price quote in writing. If an organization won’t help
you because you can’t afford to pay, look elsewhere for help.
- Don’t sign any contracts without reading them carefully first. Make
sure all verbal promises are in writing.
- Try to use an organization whose counselors are certified and trained
by a non-affiliated party. Ask for the certification information.
- Obtain assurance that your personal information (including address,
phone number and financial information) will be kept confidential and secure.
More information is available online at:
- FTC: New consumer protections reguarding debt relief
- Attorney general Bill McCollum sues Broward timeshare business
- New credit card law officially in effect
- Florida attorney general joins 12 other states attorney generals in letter against health care bill
- Attorney General Sues Online Health Product Distributer
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I think that the attorney general is right on. Unfortunately their are companies out there standing in line waiting to take an unsuspecting consumers money. I agree that the consumer needs to do their home work when faced with financial challenges and seeking a solution. Be sure to do your home work, ask a lot of questions and read ALL the fine print. Their are good companies out their you just need to make sure you are dealing with a reputable firm.
You should practice what you preach.