Debt Settlement Industry to FTC: We Provide Valuable Service to Consumers

MADISON, Wis.— Concerned about proposed federal rules that would effectively eliminate its industry, The Association of Settlement Companies (TASC) recently provided the Federal Trade Commission data that supports the value of debt settlement to consumers in response to the agency’s proposed changes to the Telemarketing Sales Rule (TSR).

The FTC is seeking to create amendments—including a ban of advance fees—that would effectively eliminate a viable option for consumers who are struggling with unsecured debt. TASC outlined in a brief historical performance data that clearly illustrates the economic value its member companies deliver to consumers enrolled in debt settlement programs.  

For example, based on a recent data analysis of its members, TASC estimates its members settled more than 94,000 accounts representing more than $553 million in debt in the first 6 months of 2009. This is an annual rate of more $1.1 billion in debt settled by TASC members for just 2009.

“We firmly believe that debt settlement should remain an option for those tens of thousands of consumers each year who choose debt settlement as their preferred—and often only available—program to handle their financial situation,” Chris Kesterson, President of TASC, said. “In our response to the FTC, we clearly demonstrate the value consumers receive from our companies who work diligently on their behalf each day to negotiate settlements with creditors.”

TASC is the leading trade group of the debt settlement industry. The cornerstone of TASC’s mission as an organization has always been to promote fair legislation at the state and federal level designed to protect the consumer and to promote best practices of operations by its members.

Without advance fees, debt settlement companies would have to work for free for the duration of the settlement process, which typically takes three years. No company in any industry could accept this, Kesterson pointed out.

“We look forward to working with the FTC in exploring appropriate and comprehensive ways to regulate the entire debt settlement industry, rather than only one segment,” Kesterson said.

The FTC will play host to a public forum on Nov. 4. To view TASC’s brief, please visit www.tascsite.org/pdfs/TASC_Comment_Letter.PDF.

About The Association of Settlement Companies
The Association of Settlement Companies (TASC) promotes fair business practices, consumer protection and industry standards for the debt settlement industry. TASC, founded in 2005, serves to protect consumers through an organization seal that represents best practices and standards of reputable companies. The organization also protects its member companies through lobbying efforts at the state and national levels, as well as awareness initiatives to educate consumers on debt settlement as a financial solution. All TASC member companies pledge compliance to strict association bylaws governing business practices and ethics. For more information, visit www.tascsite.org.