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Debt Settlement Company Settles Consumer Claims

CONTACT: Elliot Burg, Assistant Attorney General, (802) 828-2153

May 27, 2009 - Debt Remedy Solutions, LLC, a Texas company based in Boca Raton, Florida, that negotiates debt settlements for consumers, will refund over $30,000 in fees to Vermonters and pay the State of Vermont $30,000 to settle claims that the company violated Vermont’s law by unlawfully engaging in the business of debt adjustment without a license and otherwise violated the Vermont Consumer Fraud Act. Commenting on the settlement, the second this year involving a debt settlement firm, Vermont Attorney General William H. Sorrell stressed the importance of protecting Vermonters facing economic hardship: “Companies that claim to be able to help folks with their finances must follow our laws.”

According to the Attorney General, Debt Remedy Solutions violated the Consumer Fraud Act by not complying with Vermont’s three-day right to cancel requirements for telephonic transactions, and by failing to have prior documentation for online claims such as “Reduce your monthly payments by up to 50% immediately!” and “Become debt free in 36 months or less!”

Debt Remedy Solutions charges its customers a fee of up to 15 percent of the amount of the debts placed for settlement. The company entered into contracts with 14 Vermont consumers.

Under the terms of the settlement, Debt Remedy Solutions will, among other things, refund all fees collected from its Vermont customers; pay $2,000 to any Vermont customer who was sued by a creditor after signing up with the company; and promptly complete, without charge, negotiations with the creditors of its Vermont customers, at each customer’s option.

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