Morrisey Files Suit Against Debt Settlement Firm

January 2, 2014
Charleston Gazette (WV) 

West Virginia Attorney General Patrick Morrisey has brought a lawsuit against Legal Helpers Debt Resolution in the wake of a two-year investigation launched by his predecessor, Darrell McGraw. The Nevada-based debt settlement firm allegedly collected upfront fees from 250 customers in West Virginia in exchange for helping to resolve their debt problems, but it never settled those debts.

Customers paid more than $198,000 in fees, according to the lawsuit. "We believe ... that the defendants provided no legal services or any discernible value to their customers in the state even though they collected fees from them," Morrisey said in a news release. AGs in Indiana, Illinois, Rhode Island, and Oregon have already filed lawsuits against Legal Helpers. The company agreed to stop doing business in Illinois and paid fines and restitution, but the other cases are pending.

The West Virginia lawsuit alleges that attorneys working with Legal Helpers were not licensed to practice in the state. Legal Helpers failed to "clearly and conspicuously disclose" that it would not settle customers' debts or begin to negotiate debt-settlement agreements until customers had paid all fees in advance, it further claims. The suit is asking a judge to block Legal Helpers from conducting business in West Virginia and is requesting that Legal Helpers refund fees to customers.

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