10 Recession Era Scams


5
Credit Card Debt Reduction
Some scammers will offer to attempt to reduce your credit card debt -- for a fee.
Some scammers will offer to attempt to reduce your credit card debt -- for a fee.
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Similar to the foreclosure rescue scam, "debt settlement" companies claim that they can arrange for a credit-card holder's debt to be paid off for up to 70 percent less than the balance. The catch is that customers must pay an upfront fee, which is non-refundable in the event that the company fails to lower the debt. Scammers often enlist customers without analyzing whether the customer is likely to be eligible for debt reduction and sometimes advise that the customer stop paying the monthly bill, which only creates more debt.

The FTC advises you avoid doing business with any company that guarantees it can make unsecured debt go away or tells customers to stop communicating with creditors. The Commission recently put a stop to deceptive phone calls marketing debt reduction services, but Allison Southwick of the Better Business Bureau expects that the scams will continue. "The people running these scams will just become more creative in how they get to people."

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