Debt settlement and other credit-related issues topped the list of consumer complaints in Illinois last year, Illinois Attorney General Lisa Madigan said today as she released her top 10 consumer complaints, detailing concerns of the 170,000 consumers who contacted her office’s Consumer Protection Division in 2010.
That consumer debt again topped the list of concerns in 2010 mirrors what Madigan’s office has seen in recent years as consumers struggle with pocketbook issues in a down economy. Complaints related to residential mortgages ranked highest among consumer debt concerns, showing that, much like 2009, people are still fighting to stay in their homes. Many consumers also contacted Madigan’s office over credit card debt and abusive collection practices.
“The economic crisis continues to affect consumers in Illinois,” Attorney General Madigan said. “People are struggling just to make ends meet. Consumers should know my office is here to help protect them against financial abuse and from con artists who are taking advantage of these tough times to make a quick buck.”
Included in the more than 7,000 consumer debt complaints filed with Madigan’s office is a new attempt to evade recent reforms aimed at protecting consumers. Last year, Madigan successfully led an effort to pass the Debt Settlement Consumer Protection Act, which bans upfront fees debt settlement companies charge and requires they can only collect fees if a consumer’s debt is actually settled.
Legal Helpers
Madigan today filed a lawsuit against a national legal firm that has unlawfully charged upfront fees to consumers in Bureau, Champaign, Kendall, Will and Cook counties. Madigan’s suit, filed in Sangamon County Circuit Court, alleges Legal Helpers Debt Resolution LLC unlawfully charged consumers upfront fees for debt settlement services with promises to make them debt free. But, in fact, they never lowered the consumers’ debt and actually left them worse off financially.
The lawsuit alleges Legal Helpers Debt Resolution, based in Chicago, illegally charged fees upfront under a guise that attorneys, who are exempted from an upfront fee ban, were providing the debt settlement service to consumers, enabling them to charge the initial fees. In fact, Madigan alleges, attorneys with Legal Helpers Debt Resolution only served as a front to the business, and debt settlement service was contracted out to non-lawyer, third-party companies.
