66 East Main Street, 3rd Floor Little Falls, NJ 07424

Beware of Debt Settlement Companies – They don’t put you back on top of Mount Everest

Share on facebook
Share on linkedin

The Federal Trade Commission (FTC) put a stop to the allegedly deceptive practices of a debt settlement operation that lured consumers with exaggerated claims about how it could help reduce their debts.   The defendants behind the operation have agreed to a settlement that prohibits them from making any further misleading claims.

The FTC case against FDN Solutions, LLC and Timothy Daniels (also D/B/A Everest Debt Solutions)

  • The defendants claimed, mostly through Google ads and websites they used, such as everestdebtsolutions.com, 1800debtsettlement.com, that they could reduce debts by 40-60%
  • FTC charged that these savings claims were misleading, because they did not take into account the consumers who dropped out of the program, or the fact that the fees each client paid totaled 30 % of the savings achieved.

The FTC alleged that Daniels and his company, also doing business as Everest Debt Solutions, 1800debtsettlement.com, and everestdebtrelief.com, violated the Federal Trade Commission Act by making unsupported savings claims and by using a fake consumer testimonial.  One supposed testimonial attributed to “Alicia S., Lake Charles, LA” said, “Everest Debt Solutions was able to drop my credit card debt down 62%!  They are truly a Godsend!  God Bless.”

The defendants’ websites provided consumers with toll-free numbers they could call for more information.  When they called, the defendants violated the Telemarketing Sales Rule by misrepresenting the amount of money or the percentage of the debt amount that a consumer could save by using their services, according to the complaint.

Don’t pay for financial assistance before receiving the services.

FTC’s Telemarketing Sales Rule prohibits companies that sell debt relief services over the telephone from charging fees before they settle or reduce a customer’s credit card or other unsecured debt.  This ban on advance fees protects all consumers who have enrolled in a debt relief service since October 27, 2010.

I recommend you come in for a consultation before you utilize the services of debt settlement companies so that you can obtain a clear picture of your options.