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Experts offer advice in wake of agency not paying customers' bills
Published on Saturday, Jan 05, 2008
We all know we're now in an economy in which some people are struggling to pay their bills.
So it's heart-wrenching to hear about consumers whose creditors haven't been paid through their debt-repayment plans, as the Beacon Journal reported Friday.
Customers of Falls Consumer Credit Management Inc. on South Arlington Street have been reporting to the Ohio Attorney General's office and local Better Business Bureau that in some cases, two months' worth of payments have been taken from their bank accounts, but creditors have not been paid. They've been unable to contact anyone at the nonprofit credit management agency. It has been closed since Christmas and it's unclear whether it is closed because of legal troubles or because of the holiday.
On Friday, some consumers told me it appears some December payments were made to creditors on Dec. 31, though their November bills are still unpaid. A few consumers said all of their December payments had been made, while one said only his larger December payments had been made, leaving smaller ones unpaid.
By late Friday afternoon, there were 23 complaints against Falls Consumer Credit, up from eight on Thursday.
Craig K. Rohr, president of Falls Consumer Credit, has been
sued by one of his former employers, Hartville Homes. The suit contends Rohr embezzled money from a group home for disabled people and and funneled it through other businesses he owns or controls, including the consumer credit agency.
Jackson Township police raided Falls Credit on Dec. 27 as part of a criminal investigation, but officials aren't saying much about that investigation.
Until Christmas, when the complaints started coming into the BBB and attorney general's office, Falls Consumer Credit had a good record with both.
Sometimes, consumers can do all of the right research and pick a company with a good history, and still have trouble, said Cynthia Sich, executive director of the Summit County Office of Consumer Affairs.
With more consumers facing debt problems, there might be an influx of people looking for debt-consolidation agencies. Many look out for your well-being, but some might not.
In addition to checking on the organization's record with the local BBB and the attorney general's office, there are a number of questions you should ask as you're interviewing different agencies. (See accompanying article.)
Red flags should come up if an organization is encouraging you right away to go into a debt-repayment plan instead of offering to counsel or teach you how to get control of your finances, said Jay Seaton, area president of the Consumer Credit Counseling Services of Northeast Ohio.
Seaton said 40 percent to 45 percent of the people his agency sees for an initial free consultation don't enter a debt-repayment plan, in which the agency negotiates lower payments with your creditors and takes your payments to send to the creditors. Seaton said those people instead leave with a debt action plan that they pursue on their own.
Seaton said most of the consultations are done in person, instead of in 15 minutes on the phone.
''How much can they learn about your debt and you over the phone? If within 15 minutes or so they're trying to get you into a debt-repayment plan, be wary,'' Seaton said.
Sich, with the Summit County Office of Consumer Affairs, said consumers should first try to negotiate with a lender or credit-card company on their own by seeking a request for financial hardship. If you're uncomfortable doing this yourself, you can seek aid at a local credit counseling agency or some local housing counseling agencies that also provide budget and credit services, Sich said.
Sich usually recommends finding a local credit counseling agency and doing research. Some community groups also offer free debt counseling, she said.
''There's a lot that advertise on the Internet and TV. I always tell people to see what there is locally, because you can always go to their doors,'' Sich said.
But don't be misled just because an agency says it is nonprofit. Some say they are, but don't necessarily apply for the IRS designation. Seaton said he recommends nonprofit organizations accredited by one of the national credit counseling organizations, such as the National Foundation for Credit Counseling and Association of Independent Consumer Credit Counseling Agencies, since they are under strict rules to take care of the consumer's needs.
Sich said that when consumers enter into a debt-repayment plan with an agency, it's still important to stay personally involved.
''Even though you've hired someone or paid someone, I always tell people to stay on top of it. In the end, the creditors are not going to call (the agency); they'll call you,'' Sich said.
Betty Lin-Fisher can be reached at
330-996-3724 or blinfisher@
thebeaconjournal.com.
We all know we're now in an economy in which some people are struggling to pay their bills.
Get the full article here.
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