Lawsuit Claims Debt Settlement Fraud
by: Pat Hernandez, May 20, 2009 5:05:34 pm
The companies named in the enforcement action include Dallas-area based BC Credit Solution, LLC & LH Financial Service, Four Peaks Financial Service of Scottsdale Arizona and and Newport Beach California based DebtOR Solution. Attorney General Abbott says they're charged with misrepresenting the nature of their services and misleading customers about the protections they are guaranteed by Texas law.
"We suspect that there will be a large number of victims here in the Houston area. And the greatest negative impact probably resulted in the Houston area, because of these practices, and as a result, it may be the greatest beneficial impact of these lawsuits that will take place in the Houston area."
He says the defendants failed to clearly disclose the material terms of their debt settlement programs, including the risk of lawsuits. Abbott says customers' credit scores could also be affected.
"We're seeking that these businesses stop these practices that we contend violate the Texas Deceptive Trade Practices Act. We're seeking penalties of up to 20-thousand dollars per violation, and three, we will be seeking restitution for all the consumers who may have lost money to these debt settlement companies."
Abbott reminds us of one basic rule of thumb:
"If something seems too good to be true, it probably is."
Pat Hernandez, KUHF Houston Public Radio News.