Atty. General Madigan: Illinois now has the nation’s toughest law regulating debt settlement operators

 Today, (August 3, 2010) Illinois consumers won. Illinois enacted the nation’s toughest law against the abusive practices of debt settlement operators who promise to settle consumers’ credit card debt for a “fraction of the cost.” To find out more about this issue, check out check out my Huffington Post article.

For too long, these operators have been taking advantage of vulnerable consumers, making unrealistic promises to negotiate significant credit card debt reduction. Instead they charge exorbitant up-front fees and give bad advice. Thankfully, this new law, the Illinois Debt Settlement Consumer Protection Act, means that debt settlement firms will be prohibited from charging up-front fees for their services and advising consumers to stop paying their bills.

I initiated this legislation because of the drastic increase in complaints that my office has received from consumers victimized by unscrupulous debt settlement firms. Since 2009, I have filed seven lawsuits against debt settlement operators who used abusive and deceptive practices to take advantage of vulnerable consumers looking for help. The Illinois Debt Settlement Consumer Protection Act will insure that those struggling to get back on solid financial ground are not dragged further into debt.

Also, thanks to Senator Jackie Collins and Representative Marlow Colvin who did a great job advancing this landmark consumer protection law through the Illinois General Assembly.

And thanks to all of you who took time to contact your legislators—your support on this issue is why these important protections are now law.

Illinois Attorney General Lisa Madigan

Illinois Gov. Pat Quinn signs the Illinois Debt Settlement Consumer Protection Act into law while Atty. General Madigan and other legislators look on.