Deny the Debt-Settlement Industry the Carve-Out From Ohio Law They're Seeking in Columbus: Editorial

January 19, 2014
Cleveland Plain Dealer (OH) 
A new bill is pending in Ohio’s Senate, after passing the Ohio House of Representatives, that the Cleveland Plain Dealer editorial board calls "grotesquely anti-consumer." Substitute House Bill 173 purports to “regulate providers of debt settlement services” but actually would offer debt settlement a way to skirt current fee caps under Ohio's existing debt-adjusting law.

Debt adjusters claim to negotiate with creditors on behalf of indebted consumers, intending to persuade a creditor to accept less than the entire balance owed.

A bipartisan 2004 law, Substitute House Bill 420, was passed unanimously and now regulates debt adjusters in Ohio. It forbids debt adjusters to charge “a periodic fee or contribution more than 8.5 percent of the amount paid by [the] debtor each month or $30, whichever is greater,” according to the office of Attorney General Mike DeWine. This law also appears to force debt settlement service providers to observe the monthly 8.5 percent or $30 fee cap, unless the proposed H.B. 173 becomes law.

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