Debt settlement company fails

Seven On Your Side
May 13, 2008 11:18:16 AM PDT
The claims sounded too good to be true. A debt settlement company that promised to negotiate your credit card bills down to just pennies on the dollar. One Bronx woman trusted them enough to send them thousands, but wound up losing much more.

"They are thieves," said Irene Brown.

Irene Brown is talking about a debt settlement company called Hess Kennedy.

Irene says it promised to get her creditors to slash her bills. She agreed to pay them $450 per month.

She adds, "They (said they) are going to eliminate my debts."

But Hess Kennedy never paid any of her credit card bills. Now interest and late charges grew Irene's debt to $25,000. Her creditors have now sued and even frozen her bank account.

What does Hess Kennedy say? A reporter from WPLG came face to face with the company's COO outside their Florida office.

In February Florida's Attorney General sued Hess Kennedy for deceptive trade practices in misleading thousands of consumers.

"This is a terribly frightening time for many consumers. And a lot of the unethical companies know that and will pray upon that," said an employee of Nova Debt.

Non profit Nova Debt helps consumers for a minimal charge.

They add, "What's happening is the settlement companies will hold the money in a separate account. While the accounts, while your credit card accounts continue to go delinquent."

As for Irene? After Eyewitness News called, Hess Kennedy refunded all her money more than $8,500.

Hess Kennedy wouldn't talk about the Attorney General's lawsuit. But it did say they came up short in their customer service and had agreed to refund money for all of their unhappy clients. The Florida AG says their case is in the discovery phase.

Now if you want a non-profit credit counselor, Click Here.

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FTC: In Debt? Advice for Consumers in Trouble, Click Here.