The Attorney General of Massachusetts has reached a $600,00 settlement with a payment processing company that was accused of assisting a debt settlement company in engaging in unlawful business practices such as charging consumers premature and inflated fees.
A copy of the Assurance of Discontinuance, filed against Global Holdings, can be accessed by clicking here.
Global was responsible for processing settlement and fee payments for consumers enrolled in debt settlement services with DMB Financial. DMB was the subject of a $1 million consent order last year with the AG of Massachusetts, which came after the company was sued by the Consumer Financial Protection Bureau for allegedly engaging in abusive and deceptive tactics.
Global transferred unlawful fee payments to DMB despite having knowledge of the settlement provider’s misconduct and even after the company was sued by the AG’s office, according to the AOD.
Under the terms of the settlement, Global will pay the Commonwealth $600,000 and make changes to its business practices that will prevent it from transferring untimely fees from any Massachusetts consumer to any debt settlement company. That includes linking the payment of a settlement fee to a Debt Settlement Provider to the initial payment of the settlement amount or installment payment to the specific creditor for which the fee has been earned. At least one payment to each of a customer’s creditors enrolled in a debt settlement program is made pursuant to a negotiated settlement agreement with that specific creditor before the debt settlement company is paid any or all of its fee for negotiating a settlement of that specific debt.
“It is important for our office to protect the economic security of vulnerable, low-income residents against harmful business practices,” said Maura Healey, the Attorney General of Massachusetts, in a statement. “We are pleased to be able to return money back to consumers through this settlement and prevent this company from facilitating unlawful fees in the future.”