AG Says Company Deceived Mainers

AUGUSTA (NEWS CENTER) -- Maine Attorney General Janet Mills announced she has filed a suit against a Texas company.

Mills says Credit Solutions of America, Inc. (CSA) and its president, Douglas Van Arsdale participated in unfair and deceptive practices in debt settlement for hundreds of Mainers. 

The lawsuit claims that the company is not registered as a debt management service.  The suit is to recover fees paid by Maine consumers, and civil penalties.

CSA allegedly charged people more for debt settlement services than allowed by Maine law and misrepresented the benefits of the program to consumers.  The suit also says CSA purposely did not disclose important conditions and terms of contracts.  The state also claims that CSA exploited people so they would drop out of the program before their debt was settled but after they had paid fees to the company. 

CSA says it will settle any unsecured debt by as much as 60% of the original debt amount.  It requires people to pay an upfront fee before the debt is settled. 

They tell their customers to stop paying on their debt and save the money towards a settlement payment that will be negotiated by CSA.  According to the Attorney General's Office, people are told to stop talking to their creditors and to direct all of their questions to CSA, but CSA fails to return calls and answer consumers questions.  The state claims that settlements made through CSA are no better than ones consumers could get from contacting their creditor themselves.

In a response sent to NEWS CENTER, CSA CEO Doug Van Arsdale says, "This shows a misunderstanding of the industry and of our company.  When people become overwhelmed by credit card and other debts, the need help.  We provide it."

Representatives for CSA say the Maine Attorney General's Office was incorrect in calling the company a debt settlement company.  They also say they inform their clients of the risks and benefits of their program. 

Van Arsdale says, "It seems the Maine Attorney General's Office is letting down its citizens by trying to remove a truly independent...alternative to bankruptcy for those burdened by credit card debt.

To find a list of debt management providers that are registered as debt settlement companies click here.  You can also call the Bureau of Consumer Credit Protection at 1-800-332-8529.