Keith Loria Jul. 20, 2010, 11:00am
MONTPELIER, Vt. (Legal Newsline) - Vermont Attorney General William Sorrell announced on Monday that he has reached a $206,000 agreement with two debt settlement companies charged with violating the Vermont Consumer Fraud Act.
The Mossler Law Firm, P.C., and SCF State Capital Financial, Inc., allegedly engaged in debt adjusting without a license and failed to abide by the provision of the Vermont Consumer Fraud Act that allows three days for people to cancel contracts.
Sorrell also alleged that SCF failed to validate and substantiate offers that its Web site claimed to be true. Among its alleged promises were: "Debt free in 12 to 36 months" and "State Capital Financial settles your outstanding debt by eliminating 40 percent-60 percent of your total outstanding debt through negotiations!"
Under terms of the settlement, The Mossler Law Firm has agreed to stop all business in the state and will refund Vermont customers approximately $79,500 in fees it collected. It will also pay the state $60,000 in civil penalties.
SCF will pay approximately $26,800 in refunds and $40,000 in civil penalties to the state. The company will also offer free negotiations with the creditors of all 11 of its Vermont customers.
Both companies will also pay $2,000 to any Vermont customer who was sued by a creditor after signing up with the company.
"Vermonters who might be considering the services of a debt adjuster should know if the company is licensed to do business in Vermont, as required by law," Sorrell said.
"Consumers can also call the Consumer Assistance Program to find out if any complaints have been logged by other Vermont consumers against a particular debt adjuster."