Government of Ontario and the Government of Canada have both now issued Consumer Alerts regarding Debt Settlement Practices.
Government of Canada Warns Canadian with Debt Problems “Beware of too good to be true offers”.
Jan. 10 2012
The Financial Consumer Agency of Canada (FCAC) issued a warning to Canadian Consumers looking for debt reduction. ” Be very cautious about companies that claim they can negotiate a deal with your creditors.
These companies call them selves Debt Settlements, Debt Relief, Debt Negotiation, Credit Repair and Credit Counsellors. Many of them are moving in from the US with high pressure, aggressive sales tactics. Although not illegal, these companies are not licensed or legislated.
Often Canadian never see the debt reduction that is promised from these companies, as the creditor are not legally bound to negotiate the reduction of the debt with anyone except Trustees in Bankruptcy. Very often the consumer ends up deeper in debt than when they started. Borrowing even more to pay the “Debt Settlement” company their fee, in advance of the negotiation.
Canadians need to use caution and common sense whenever discussing financial items.
Only Bankruptcy Trustees in Canada can protect you legally from your creditors. Don’t be fooled by any other group promising to protect you.
Ontario Consumer Alert : Debt Settlement - May 8 2012
Government of Ontario Issues a warning to consumers with debt. Creditors are not obligated to negotiate with debt settlement companies. False claims, aggressive marketing are taking advantage of already vulnerable consumers. See the Full Warning by the Government of Ontario HERE.