Newsline) — A debt-relief company and its principals have been banned from misleading
consumers and charging illegal advance fees under a settlement with the Federal Trade Commission (FTC).
charged United Debt Counselors LLC with exaggerating how much money people
could save by using its services. According to a March 7 FTC statement, the company marketed
its services via direct mail that appeared like official bank documents. These
ads, which reached close to 100,000 consumers per week, claimed customers could
halve their credit card debt. United Debt Counselors allegedly echoed these
false claims on their website and by phone when consumers called.
would allegedly send notaries public with almost no debt relief knowledge to
meet with consumers and witness contract signings. The FTC claimed the company
charged advance fees that violated the FTC’s Telemarketing Sales Rule. To
charge an advance fee, a company must first meet with a consumer face-to-face
using an experienced and knowledgeable sales representative.
also noted that fewer than half of the consumers who paid for services competed
the program, and even fewer ended up debt-free after 36 months.
defendants in the case are United Debt Counselors LLC, also known as United
Debt Services LLC and also doing business as Department of Negotiations; David
Melrose; Kirk Lanahan; and Corinne Maples.
voted 2-0 to authorize the staff to file the complaint and stipulate the final
order, which was placed in the U.S. District Court for the Eastern District of