The Federal Trade Commission (FTC) announced this week that it was mailing checks to more than 5,000 consumers who had been mislead by an unscrupulous debt settlement company. In addition to the monetary settlement, United Debt Settlement has been banned from making misrepresentations about debt relief and other financial products or services, and making unsubstantiated claims about any products or services.
According to the Commission, the company made exaggerated claims about how much money debtors would save, indicating that the average consumer would see credit card debt cut in half and become debt free in three years. The debt settlement company also used misleading direct mail materials, which were designed to look like official documents from a bank or a law firm.
The average refund payable under the settlement is small, and consumers are unlikely to be made whole. Unfortunately, that is often the case when debt settlement companies mislead consumers, unlawfully take advance payment, and otherwise behave dishonestly. Anyone considering options for reducing or eliminating debt should thoroughly vet any provider by searching out reviews and checking with reliable sources such as the FTC and the Better Business Bureau.
FTC Returns Money to Consumers Harmed by Debt Settlement Scheme
Tags: debt settlement, financial scams
