Since Jan. 2008 I documented the Federal Debt Relief System (FDRS) debt "elimination" FRAUD. FDRS owner Mark Cella and his sales people promised "debt elimination", charged consumers thousands of dollars and delivered NOTHING.
Many victims have been sued by creditors like Citi Bank who KNEW about the fraud, but choose to pursue the defrauded consumers.
Many victims filed their complaints with California attorney general Jerry Brown. In summer 2009 I spoke with Jerry Brown's investigator Gayle Weller and she requested MORE complaints with documentation.
Readers submitted the contracts and their detailed complaints to the attorney general's office, but they did NOTHING!
According to former FDRS employees, they made millions. Mark Cella moved on to other ventures and it is crystal clear that CRIME PAYS in California.
Many readers submitted their FDRS DAMAGE REPORTS.
I finally submitted my 7/28/10 open letter to AG Jerry Brown and I demanded the arrest of Mark Cella and a full investigation.
In response, I received the same form letter as the FDRS victims. AG Brown is doing NOTHING to prosecute these criminals.
AG Jerry Brown is currently running for governor of California.
I hope that not only FDRS victims, but all who value honesty and fair dealings with consumers will publicize the corruption of AG and governor candidate Jerry Brown.
There are many other scammers, such as John Gliha, Debt Crisis Solutions and the COUNTLESS unscrupulous opportunists who prey on desperate people with huge debts.
The latest scam (New Life Solutions, Credit Answers) is to promise settlements of about 40% of the outstanding balance if consumers enroll in their debt settlement program.
They lie about the resulting credit reporting, falsely claim that bankruptcy discharge is not an option unless you earned less than the average income in your state for the last two years, etc. etc.
These debt settlement companies encourage consumers to STOP paying their credit cards and to instead make payments into savings accounts set up by them.
The SCAM: they take 12% of these payments!!!
Most people will not be able to save up enough money to settle their debts because they either run out of money or creditors SUE them.
These scammers don't disclose that there is NO need to pay them to settle because after you stopped paying your credit cards, most banks will send settlement offers directly to you. And if you don't settle, they can sue you -- whether you are enrolled in a debt settlement program or not.
There is NOTHING of value these outfits do for you -- they only take your money.
I also recommend that (near) judgment-proof consumers STOP paying their unsecured debt.
The difference: I don't charge for this advice and I LIMIT this advice to people who are either at least close to judgment-proof or ready to FIGHT creditors and collectors in court.
That Jerry Brown condones these heinous crimes against the most vulnerable people is one more reason to stop paying the national banks.
While the banks got their bailouts (and no, the government did NOT make money on the bailout because AIG did NOT pay back the many billions it received to forward to the banks), the working people are thrown to the wolves -- by California AG Jerry Brown and many others with the power to make a difference.
Vote with your money!
KEEP your money!
Update 10/5/11: As you probably know, AG Jerry Brown was elected to California governor. I STILL get pleas for help from FDRS scammees who are now getting sued for debts they thought were settled.
We're in no financial position to assist readers free of charge and unless you are a fighter and willing to challenge creditors and debt buyers (a reader got a lawsuit dismissed), I recommend looking into bankruptcy and determining whether you are judgment-proof.
According to the feedback we have received, consumer attorneys require large upfront retainer payments to sue FDRS / Mark Cella because it is very unlikely that anyone will ever receive one penny for legal fees or restitution.
Governor Brown had the power to freeze assets and to prosecute the bastards on CRIMINAL charges, the best way to help scammers remember where they're hiding the loot.
Governor Brown chose to condone this fraud.