Wednesday, May 20, 2009, PM | Leave Comment
New York Attorney General Andrew Cuomo yesterday scored his gains with a crackdown on two major outfits he accused of tricking and gouging consumers with debt-settlement schemes that caused more grief than relief for cash-strapped debtors. Mr. Cuomo sued two debt settlement companies Tuesday, accusing them of fraudulent business practices and false advertising.
He said Dallas-based Credit Solutions of America Inc. and Phoenix-based Nationwide Asset Services Inc. and its affiliates failed to deliver on promises to consumers.
According to Cuomo, Credit Solutions of America charged exorbitant fees for advising consumers to mow lawns, give up part of their car insurance, borrow from their neighbors and church, as well as sell their blood plasma to raise cash for credit-card collectors.
Some 18,000 New Yorkers signed up for the service over the past five years, but just 2,000 got what they paid for, the attorney general charged.
Moral of the Story
When he announced the investigation on May 7, Cuomo said many people who enroll in debt settlement plans aren’t able to complete them successfully, so they end up stuck with high fees and in worse shape than when they started.
So for now, stay away from those two companies until further news from Mr. Cuomo’s office.Facebook.com/doable.finance