Senate Committee on Homeland Security and Governmental Affairs

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U.S. Senate Committee on Homeland Security and Governmental Affairs

Permanent Subcommittee on Investigations

Title: Profiteering in a Non-profit Industry: Abusive Practices in Credit Counseling

Date: 3/24/04

Time (EST): 9:00 AM

Place: Dirksen Senate Office Building, Rm. 342

The Permanent Subcommittee on Investigations intends to hold this hearing to address the problems facing the credit counseling industry. Once community-based and consumer-friendly, the credit counseling industry has undergone significant transformation during the past several years. New and aggressive profit-driven participants have entered the market, causing a rash of consumer complaints about high fees, misleading advertising, and poor service. The proliferation of for-profit, “back-office” servicing companies is threatening to change the industry into a debt collection mill instead of an industry whose focus should be on consumer counseling and education. The Subcommittee’s March 24th hearing will review the most egregious cases of misconduct among credit counseling agencies and their for-profit service providers and examine what solutions may be available to repair the industry. The Subcommittee will hear from victims and ex-employees of the credit counseling industry, representatives of for-profit service providers and credit counseling associations, as well as a panel of government regulators.

To view the Staff Report, follow this link to the PSI Subcommittee Webpage.

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Member Statements

Senator Norm Coleman [View PDF]

Senator Carl Levin

Witnesses Testimony

Panel 1

Raymond Schuck , Victim , Cambridge Credit Counseling, Inc. , Lima, Ohio

John Pohlman , Former Employee , Cambridge Credit Counseling Corp. , East Granby, Connecticut

Jolanta Troy , Victim , AmeriDebt, Inc. , Carlies, Pennsylvania

John Paul Allen , Former Employee , AmeriDebt, Inc. , New Market, Maryland

Panel 2

Chris Viale [View PDF] , General Manager , Cambridge Credit Counseling Corp.

Matthew Case , Chief Executive Officer , AmeriDebt, Inc. , Germantown, Maryland

Cuba Craig , Chief Executive Officer , American Financial Solutions , Seattle, Washington

James Kroening , Director , FamilyMeans Consumer Credit Counseling Service , Stillwater, Minnesota

Panel 3

John Puccio [View PDF] , Chief Executive Officer , Cambridge Credit Counseling Corp. , Agawam, Massachusetts

Andris Pukke , President , Debtworks, Inc. , Germantown, Maryland

Michael Malesardi [View PDF] , Chief Financial Officer , The Ballenger Group, LLC , Frederick, Maryland,

Bernaldo Dancel [View PDF] , Chief Executive Officer , Amerix Corporation , Columbia, Maryland

Panel 4

The Honorable Mark W. Everson , Commissioner , Internal Revenue Service

The Honorable Thomas B. Leary [View PDF] , Commissioner , Federal Trade Commission , Washington, D.C.

Committee on Homeland Security and Governmental Affairs
340 Dirksen Senate Office Building
Washington, D.C. 20510