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AmeriDebt Founder Settles FTC Charges

Consumers will receive just under $20 million in settlement

September 12, 2008

Credit Counseling • New Jersey Sues Credit Repair Agencies • States And FTC Crack Down On Credit Repair Scams • AmeriDebt Founder Settles FTC Charges • FTC Charges Home Buying Operation With Credit Repair Scheme • FTC Charges Express Consolidation Misleads Consumers • Debt Free Agrees to West Virginia Refunds • Ohio Sues "Credit Counselor" For Deceiving, Threatening Consumers • Debt Management Telemarketers Settle FTC Charges • FTC Shuts Down 20 "Credit Repair" Schemes • FTC Sues "Debt Elimination" Programs • AmeriDebt Founder Settles FTC Charges for $35 Million • IRS Plans to Yank Tax-Exempt Status of 20 Credit Counselors • IRS Revokes Tax-Exempt Status of Four Credit Counseling Agencies • Three Debt Management Firms Settle Federal Charges • AmeriDebt To Close as Part of FTC Settlement • Credit Counseling Riddled With Fast-Buck Promoters, Congress Finds • Credit Counselors Not Always What They Seem • Credit Counseling Scams On the Rise • Lenders Ratchet Down Payments to Credit Counselors --- • More about Credit Counseling

The Federal Trade Commission has returned approximately $12.7 million to consumers from a settlement with Andris Pukke and his companies, AmeriDebt, Inc. and DebtWorks, Inc. The action resolves the largest credit counseling/debt management deception case brought by the FTC.

In addition, more than $7 million will be returned to consumers as a result of class-action settlements with the defendants and related credit counseling agencies.

Using the defendants' records, about 287,000 AmeriDebt consumers have been mailed redress checks. The FTC and individual consumers charged that AmeriDebt, DebtWorks, and related credit counseling agencies engaged in deceptive practices in promoting and offering credit counseling and debt management plans (DMPs).

Consumers who qualified for redress, a total of about 460,000 consumers, obtained a DMP from one of 11 credit counseling agencies serviced by DebtWorks between January 31, 1998 and October 7, 2004.

The agencies were AmeriDebt, Inc., Debticated Consumer Counseling, Inc., A Better Way Credit Counseling, Inc., Credicure, Inc., Mason Credit Counseling, Inc., Nexum Credit Counseling, Inc., Neway, Inc., The Credit Network, Inc., Visual Credit Counseling, Inc., Preactive, Inc., and Debtscape, Inc.

Since May 2006, a court-appointed receiver has been working to identify all possible assets that can be liquidated for consumers' benefit. The receiver obtained a contempt order against Pukke in March 2007 on the grounds that he had been hiding assets from the receiver. A wide range of complex assets, including overseas property and property held by family and friends of Pukke, has been located and liquidated.

AmeriDebt consumers with questions should call the redress administrator at 888-309-3816. Consumers who obtained a DMP from another agency should call 888-305-3082.

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