Appropriate Credentials?

[Hypnotist]

This is my first post to these boards. I must say how valuable this information has been to my personal financial education. Thank you all for being so giving of your time, knowledge and experience in an effort to help others.

This may not be the correct place to ask, and if not, would a moderater please move my post to the appropriate forum. Before I ask my questions, rest assured, this is not a spam post.

I recently began marketing for an educational company that helps consumers understand and utilize the FCBA dispute process to fight for elimination of primarily unsecured credit card debt. We are clear to point out that we are not offering legal, financial or tax advice and are operating purely to inform consumers of their rights under applicable banking and consumer protection law. The company is a corporation in business for approximately 7 years with a very good track record of success.

Can anyone tell me what, if any, licensing or bonding might be required with a company such as this? I've noticed here that references are made to CA requirements for licensing within states where they're attempting collections... and that if they are not licensed and bonded then they have no authority to collect. I think I understand that correctly. I would like to know if specific credentials are required for an educational company (like the one I market for), to do business across state lines.

Thank you in advance for any replies!

[DocDon]

Shouldn't your employer already know that information having been in the business for 7 years?

[Hypnotist]

Shouldn't your employer already know that information having been in the business for 7 years?

Apparently they do know the requirements. I've been told that as an educational company, we are not required to be licensed like debt consolidation companies, debt collectors, attorneys or entities that offer legal, financial or tax advice. And that bonding is not required because we don't need a risk management product designed to cover potential property damage. We have a written percentage reduction guarantee instead. These answers made sense, but I think you'd agree that asking for unbiased information is a good idea. Ask a CRA if they follow the law and they will tell you they do. However, we know that they break the law all the time. Not that my company isn't trustworthy... in that case, we'd have been shut down by AG's nationwide long ago. I just spent a ton of time researching information about the necessary credentials to be in our business, but found no direct references. That's why I came here.

[DocDon]

... in that case, we'd have been shut down by AG's nationwide long ago.

Not necessarily true - the Attorneys General and FTC do not "monitor" what's going on out there - they react to complaints being filed, or something being brought to their attention. They can't possibly monitor every single company doing business out there....

Read the Credit Repair Organization Act. I think that's what you're looking for.

http://www.ftc.gov/os/statutes/croa/croa.htm

Also, individual states dictate licensure. Some require them, so don't. Michigan, for example, rescinded the requirement for a credit repair organization to be licensed around 1995. A search of state websites should better direct you to what businesses require licensure for each state.

[Hypnotist]

Thank you DocDon! I rarely take things at face value. I'll look at those links right away. I appreciate your time.

[Hypnotist]

DocDon...The refereced link deals specifically with credit repair. Our primary business is educating consumers as to their rights and remedies regarding credit card debt reduction/elimination. We provide the information and the tools for them to initiate a dispute process themselves. Their goal is to achieve significant debt reduction or complete elimination on their own through a legal administrative procedure. Actually, our purpose is very similar to that of these boards. I apologize if I was unclear about the nature of our business.

We do provide credit repair information once the dispute process reaches a certain point. In fact, we suggest that our members come to this very website for quality information. We can also suggest affiliate companies that specialize in credit repair.

[divemedic]

If you are giving the same information as on these boards, but doing it for money, you may be crossing into the "practicing law without a license" territory. It sounds like you are giving legal advice

[DocDon]

I agree. The CROA is pretty clear on who is considered a CRO - basically anyone who accepts money or other valuable consideration(with the couple exemptions listed). It doesn't sound like your a non-profit organization, or a dipository institution.

[CRO] means any person who uses any instrumentality of interstate commerce or the mails to sell, provide, or perform (or represent that such person can or will sell, provide, or perform) any service, in return for the payment of money or other valuable consideration, for the express or implied purpose of--

(i) improving any consumer's credit record, credit history, or credit rating; or

(ii) providing advice or assistance to any consumer with regard to any activity or service described in clause (i)

If I were a betting man, I'd say your "legal administrative procedure" means you are a Debt Consolidation Company who also mentions what can be done to help improve credit on the side.

That makes a little more sense about how your company may be able to sidestep licensure - especially when the "tools" you give to people are probably taken from free-help sites such as this one (or you just give them the link as you mentioned).

At any rate, you have the info you need to look for the answers you seek. Good luck!

[Hypnotist]

If you are giving the same information as on these boards, but doing it for money, you may be crossing into the "practicing law without a license" territory. It sounds like you are giving legal advice

On the contrary... we aquaint members with existing consumer protection laws that we have used ourselves to legally dispute unsecured debt. The very existence of this site validates what is true... consumer protection rights is not an area with which most people are familiar. The lion's share of our company is made up of consumers that have successfully gone through this process themselves. We make it very clear that we cannot and do not offer legal, financial or tax advice. I visited this site frequently and for some time prior to this first post, and the same disclaimer is used here. Much like you, we can simply share what we have done and point people to the tools and laws we utilized. Again, our members do this themselves.