Freedom Debt Relief
Setup Fee: 15%
Monthly Fee: None
Settlement Fee: None
TASC Members: Yes
BBB Complaints: 139
In Business Since: December 2002
Freedom Debt Relief, which is part of the Freedom Financial Network, charges a standard 15% of your total debt amount. This 15% is spread out over the first 19 months of your program. Their programs range in length from 24 to 36 months. Freedom Debt Relief is one of the larger debt settlement companies in the nation. I was told they have over 50,000 active clients. This can be good or bad depending on the level of personal service you like to receive.
Freedom has received 139 Better Business Bureau complaints over the past 36 months. Of these 139 complaints, only 84 have been closed. This means 55 complaints are still outstanding and have received no resolution. FDR’s website shows them as being an accredited member of TASC, yet when I visit the TASC site and look at their business listing, they are only being shown as a regular member. You should ask about this discrepancy when shopping for their services.
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Comment by batfang
From: The Daily Journal, San Mateo, CA.
Freedom Debt company sued for misleading customers
By Michelle Durand
Many customers of Freedom Debt Relief actually incurred greater debt through late fees and collection lawsuits because the San Mateo-based financial services company purposely misled consumers to get their business, according to San Mateo County prosecutors.
The Consumer and Environmental Unit of the District Attorney’s Office joined with the California Department of Corporation to sue Freedom Debt Relief, LLC, Freedom Financial network, LLC and company owners Andrew Housser and Brad Stroh. The lawsuit filed Oct. 30 in San Mateo County Superior Court claims the defendants engaged in unlawful business practices, including making false or misleading statements to consumers via the Internet and telephone to induce them to buy debt reduction services. The suit also claims the company violated the state financial code by operating without a business license from the Department of Corporation.
The business, located at 1875 S. Grant St. in San Mateo, advertised having approximately $1 billion in debt under management throughout the United States. The company advertised being able to negotiate a 40 percent to 60 percent reduction in debt to unsecured creditors but, according to prosecutors, instead made some customers’ situations worse.
“Instead of their debts being settled or reduced, many of the defendants’ customers suffered increased debt because of late fees imposed by creditors, referral to collection agencies or collection lawsuits. Some customers ended up in bankruptcy,” according to the suit.
Prosecutors want an injunction ordering the company to follow the law, pay restitution and pay civil penalties between $2,500 and $10,000 for each violation.
The company’s goal, according to its Web site, is to eliminate rather than simply lower debt. The plan for those who qualify, the site explains, is a “debt reduction program” which involves “affordable monthly savings obligations” to get consumers out of debt “in as little as 2 to 3 years.”
The founders have been profiled by numerous news organizations and were finalists for the 2006 Ernst & Young Northern California Entrepreneur of the Year award.
Consumers who believe they have been victimized should file a complaint with the District Attorney’s Consumer and Environmental Unit at (650) 363-4651.
Michelle Durand can be reached by e-mail: michelle@smdailyjournal.com or by phone: (650) 344-5200 ext. 102.