NJ Consumer Says Texas-Based Debt Workout Outfit Pocketed Thousands In Fees While Failing To Negotiate Satisfactory Settlements

In Nutley, New Jersey, The Star Ledger reports:

• Sharon Lemma Bozza charged her way to big-time debt. [...] Nearly $60,000 in debt and 12 delinquent credit cards later, Bozza decided to get help. In July 2008, she found Texas-based American Financial Concepts (AFC), a debt-settlement company that promised to negotiate lower payoffs for her debt. It didn’t exactly work out that way, and by the time she was through, Bozza was sued by creditors and she was out thousands of dollars in fees to AFC with nothing to show for it.

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• Here was the deal: Bozza would deposit money into a bank account from which AFC would take its fees. Eventually, she’d pay the negotiated debts from that account. After 48 months, she should be debt-free — as long as AFC could negotiate good deals and as long as she kept paying. On Aug. 11, 2008, AFC took its first of four monthly fees of $733 from the account. Those would be followed by 18 payments of $310. All fees to AFC, no debts paid yet.(1)

For more, see After hiring debt-settlement firm, Nutley mom found bills piling higher.

(1) According to the story, Bozza started with a Citi card on which she owed more than $23,000. AFC records said that on Feb. 3, 2009, it negotiated a payoff of $10,530, called Bozza at home and left a message on her cell phone. It said it renegotiated on April 13, 2009, for a settlement of $9,503. But not according to Citi, she said. "(Citi) had no indication that there were ever, ever any figures talked about, nothing broken down or offered on the account," Bozza said, adding the account was sent to a collections company.

She then contacted her Chase card, to which she owed more than $20,000, the story states. It, too, had no record of negotiations with AFC, she said, although it had been notified the company would be her debt-settlement firm.

Reportedly, at Sears, there was no record of contact by AFC, Bozza said.