The Consumer Financial Protection Bureau (CFPB) Thursday announced an enforcement action against Meracord LLC, a leading debt-settlement payment processor, for allegedly helping others to collect millions of dollars in illegal upfront fees from consumers. The Bureau has asked a federal district court to approve a consent order that would require Meracord and its CEO and owner, Linda Remsberg, to halt all illegal activities and to pay a $1.376 million civil penalty.
“Today we are taking action against Meracord, a company that made it possible for debt-settlement companies across the country to charge consumers illegal fees,” said CFPB Director Richard Cordray. “By taking a stand against those who facilitate illegal activity, we can root out harmful behavior across the debt-settlement industry and better protect consumers.”
Debt-settlement companies generally offer to help consumers reduce or eliminate their credit card or other debt by negotiating settlements with creditors. In many cases, when consumers enroll in a debt-settlement program, the company instructs them to stop paying their debts and to instead make monthly payments to a payment processor, such as Meracord, while the debts are negotiated. Meracord, which is based in the state of Washington, has been one of the largest payment processors for the debt-settlement industry.
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