AMERIDEBT SUED FOR FRAUD
September 13, 2003
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Morgan King’s Consumer Bankruptcy Newsletter reports that the state of Missouri on Thursday sued credit-counseling service AmeriDebt, accusing the company of defrauding consumers of millions of dollars through excessive, hidden fees while falsely pitching itself as a nonprofit organization.
This heavily advertised entity (you have probably seen its television commercials) is accused of failing to disclose to clients that the first payment goes to AmeriDebt, and is usually 3% of the entire debt; that it is actually a for-profit company and not a non-profit; and that its so-called credit counselors are typically untrained in professional credit couseling.
Approximately 9 million consumers contact a credit counseling service annually.
