Four companies and their principals, Robert and Miriam Lovinger, have agreed to settle Federal Trade Commission charges that they deceptively marketed a “debt settlement” program that failed to provide services they claimed would reduce consumers’ debt.
In October 2007, the FTC charged Edge Solutions, Inc. of Delaware, Edge Solutions, Inc. of New York, and Money Cares, Inc., all a/k/a The Debt Settlement Company and a/k/a The Debt Elimination Center; Pay Help, Inc.; and the Lovingers with violating the FTC Act. According to the FTC’s complaint, the defendants sold their services through the Web sites idebthelp.com, moneycares.com, edgesolutions.com, and ontrackmpower.com, offering a “Debt Meltdown Program” described as “an aggressive method of helping consumers out of the debt trap and away from the bankruptcy path.”
The proposed settlement prohibits the defendants from:
The proposed order imposes a $7 million suspended judgment that may be imposed in full if the defendants are found to have misrepresented their financial condition. The order also requires the defendants to release their claims to assets frozen by the court in 2007 and requires the Lovingers to transfer the proceeds from the sale of their Florida property to be used for possible restitution to injured consumers. Also under the order, the Lovingers may not offer a debt negotiation or debt settlement service or program to consumers in the future without first obtaining a $1 million performance bond. In addition, the defendants cannot sell, rent, or otherwise disclose personal information about anyone who paid them money before the order was entered. The settlement also contains record-keeping provisions to allow the FTC to monitor compliance with the order.
The Commission vote to authorize staff to file the proposed stipulated final order was
4-0. The order was filed in the U.S. District Court for the Eastern District of New York on August 1, 2008.
NOTE: This stipulated final order is for settlement purposes only and does not constitute an admission by the defendant of a law violation. A stipulated final order requires approval by the court and has the force of law when signed by the judge.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.
(FTC File No. X080001)
(Civ. No. Cv-07-4087)