Debt Settlement Association Pushing for Regulation, Standardization

The commentary period following the Federal Trade Commission’s recent debt settlement workshop ended Monday, with many of industry leaders hoping for some federal regulation to set some standards for the growing industry.

The Association of Settlement Companies (TASC), a non-profit organization created in 2005 to promote fair legislation, strict business standards and consumer protection for the debt settlement industry, told insideARM that it “looks forward to continuing our work toward strong legislation at both the federal and state levels to help regulate this young and growing industry.”

Chris Kesterson, president of the 170-plus member organization and CEO of Debt Settlement America, and Wesley Young, TASC executive board member and legislative committee chair, recently discussed the organization, the industry and the related businesses with insideARM.

“TASC respectfully disagrees strongly with the ABA [American Bankers Association] that a settlement intermediary is unnecessary to help consumers,” Kesterson said. “TASC member companies employ ethical, upstanding business professionals that help consumers manage financial burdens and help creditors collect debts.”

While financial services firms will say that they don’t work with debt settlement companies, that’s more the party line than the reality, according to Kesterson. “They see us as a necessary evil. While some creditors may not choose to talk about it publicly, in our experience, most creditors appreciate the good actors in our industry for helping financially distressed consumers establish and maintain a plan to pay off at least a portion of their debts, rather than declaring bankruptcy.  In fact, TASC members have successfully negotiated debt-settlement claims for customers with all of the major creditors.”

Kesterson added: “Companies in the debt buying industry are big fans of us. They know that if they work with us, they will have better collections and returns.”