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Consumer Alerts!

If you are struggling with debt (you’re constantly asking yourself, “How do I get out of debt“) and are in dire need of debt-relief, we strongly encourage you to be aware! The following information is provided to you as a consumer alert. Be aware: Do your research!


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General Cautionary Note

Unless you are intimately aware of the company, do not provide your contact information along with the amount of your debt to anyone online. Typically, they all appear to be information resellers.

Top Ten Scams list from the Better Business Bureau

The BBB has just put out this top ten list of scams to look out for (a pdf version is available here). It’s informative, and more importantly, delves in to the psychology that these schysters use with great affect:

  1. Appeal to trust and authority (ie, your trust in authority)
  2. Exploit basic human needs and desires (and, I might add, the human attachment to entitlement)
  3. Personalized, to appear legitimate
  4. Introduction of through no- or low-cost starter offerings (yes, I know that’s what I’m doing, but it’s to get you to finally start addressing a topic that tends to be painful and shameful– which btw it doesn’t need to be. I’ve been there, done that, got the t-shirt…)
  5. Belief that large cost justifies large reward (like those seminars that convince you $50,000 on credit is worth the millions you will earn)
  6. Lack of emotional control (actually, there’s a lot of emotional manipulation going on)
  7. Consumer control through hostility and guilt (even something as benign as “you’re one of the exceptional people as you have shown up” is controlling)
  8. Open for re-victimization (it’s how people spiral out of control)

All in all, it’s a fabulous, eye-opening read.

General Interpretations

  • “Same day approval.” This is usually determined by the amount you owe. Generally, if you owe more than $1,000, you can file for bankruptcy. If you own more than $10,000, your information has resell value.
  • “Cut your debt by as much as 70%.” This refers to results available to someone enrolled in a Consumer Proposal.
  • “No credit checks.” This is simply tapping into the your fear of rejection. It’s a red herring. Credit checks are not done when you enrol in bankruptcy or consumer proposals.
  • “Home Ownership not required.” Another red herring. Home ownership is irrelevant. If you own a home, you are subjected to the provincial guidelines of what you are allowed to keep if you declare bankruptcy.

“Debt reduction program.”A common phrase that is a euphemism for “bankruptcy” or “consumer proposal.” Note there is nothing wrong with either one of those options. You just need someone who calls a spade a spade, and is upfront with you about the solutions they are offering.

June 1, 2012
Erase That Debt.com

Not a whole lot (positive details) to add about this one. Standard cautions apply.

  • If this site is referencing a Canadian government-approved program (bankruptcy or consumer proposals), there is no expiry date. If this site is referencing credit counselling, there is no expiry date. If this site is referencing consolidation or debt negotiations (you guessed it…), there is no expiry date.
  • The privacy policy: http://www.erasethatdebt.com/CA/V2/privacy.htm … of concern:
    • Third paragraph, “The information we collect is used to improve the content of our Web page, shared with other reputable organizations to help them contact consumers for marketing purposes, used by us to contact consumers for marketing purposes, not shared with other organizations for commercial purposes.” I’m not too sure of the difference between marketing and commercial purposes, and I’d personally like to know how they define “reputable”.
    • Their continual reference to the “address above” (there is no address above) that you can write to if you want to be added to their do-not-mail list, or make any adjustments to the farming out of your information
  • A Google search for pages listed under that domain (enter “site:http://erasethatdebt.com” in Google) is extensive, and includes:
    • http://erasethatdebt.com/US/LP/
    • http://erasethatdebt.com/health.asp (which lists a few articles on loan consolidation)
    • http://erasethatdebt.com/refinancing.asp (which lists a few articles on refinancing your home)
    • http://erasethatdebt.com/automotive.asp (which lists a few articles on refinancing your car)
    • http://erasethatdebt.com/mortgages.asp (… on mortgages)
    • … and so on. Seems like a whole lot of farming (and Google keyword planting) is going on here.
  • A whois search turns up nothing, except to say that the URL is registered with moniker.com, which seems to be a GoDaddy equivalent. Their additional pages (see previous point) seems to indicate that they are an American-based company, so I’d be suspicious of what Canadian services they can offer.
  • The (presumably fake) “Program Expiry Date” is a standard marketing tactic. It is the sixth of Robert Cialdini’s Principles of Persuasion: Scarcity.
May 27, 2012
Canada Debt Support

As far as debt settlement advertisements go, I can actually say a few good things about it. Two things. Sort of.

On the positive side:

  • The Facebook link (pictured to the right) you take you to landing.canadadebtsupport.com (pictured just below). The bottom links don’t work BUT, if you know enough to replace “landing” with “www” you will arrive at their actual website, and then these links are good. So they do have an About page and a few other additional links.
  • Their information on debt settlement is accurate (ie, it’s a legal contractual option).

On the negative side:

  • The Facebook ad had very little to do with the landing page. The Facebook ad says that they used a “little-known Canadian law” to erase their debt. Usually, the “little-known law” is bankruptcy, because it’s actually a legislated strategy.  The landing page, however, talks about debt negotiation. Yes, it’s legal, but it’s not a little-known Canadian law!
  • The links at the bottom of landing.canadadebtsupport.com site should work! They don’t.
  • When you manually go to www.canadadebtsupport.com, the links further down (privacy, terms and conditions and site map) are all dead. This suggest amateur/incomplete design.
  • In the graph, they suggest that in bankruptcy, you can actually end up paying $41,000 on a $30,000 debt. This is incredibly inaccurate. A consumer proposal repays pennies on the dollar, and a bankruptcy can even cost you less. Your best option will depend on your income and job status, and your assets.
  • Under their “Debt Solutions” tab they only offer one solution: debt settlement. Yes, it is one solution, but there are others available. So they are suggesting that theirs is the only solution. It isn’t.
  • They suggest that contracting with them stops harassing calls from creditors. “Stop Harassing Calls from Creditors.” Maybe. There really are only two ways to ensure that calls are stopped: repay them, or go through a trustee (ie, bankruptcy or consumer proposal).
  • You don’t know who they are! I don’t know about you, but if I’m going to put my financial life into the hands of another entity, I want them to be honest and upfront from the get-go. When I searched for the owner of the domain, canadadebtsupport.com, they were actually listed by “Domains by Proxy.” The front page of “Domains by Proxy” proudly boasts, “Your identity is nobody’s business but ours.” I agree this is true for individuals, but for businesses expecting to manage an individual’s personal finances, I want open and transparent information. Personally, it’s important for me to go through a Canadian firm, which is why I look for this information.

This analysis is, of course, based on what I personally think is important: I want the company to be Canadian, I want them to be open and transparent with what other options are available (especially if they are going to have a “financial education” link!), and I want ALL the links on the page to work — especially the ones to their privacy and their terms and conditions!

May 24, 2012
Finance-News.ca

Here’s an ad on Facebook, linking to the URL finance-news.ca. On clicking the link, you are forwarded to a pre-qualification page. I am always weary of websites that have the icon “As seen on TV” followed by a bunch of Canadian (or American) news networks. I am doubly weary of websites that do NOT have an “About” link for additional information.

Before you hand over any of your financial and contact information, you should know to whom.

I did a search engine dig for additional pages on that URL, which is how I sometimes find hidden information (about, contact, privacy policies, etc). Nothing showed up. So I did a who is search in http://whois.cira.ca/, which is the ultimate Canadian (.ca) URL registry. This search showed that the finance-news.ca URL is registered to Silverthorn & Lupolover Lawyers LLP, a debt-settlement organization for Canadians operating out of Kitchener, Ontario. You can check them out for yourself at http://www.sllaw.ca/

The things that bug me about this sequence of ads:

  1. No indication of ownership. This is always my biggest concern. I should not have had to look them up on the whois.cira site to find out where I was sending my information. That is probably my biggest beef. I tend not to trust those who stay hidden in a shroud of anonymity, and yet ask for some incredibly personal data.
  2. The use of an official-looking image that suggests endorsement (but isn’t). Debt180 does this with the premiere’s image and with a major bank’s. The suggestion is that the major players endorse these “debt forgiveness programs.” Beyond supporting bankruptcy legislation, I have yet to hear Harper (or CIBC) recommend these strategies to Canadians. Moral bankruptcy comes up in a search engine dig, but not financial. If I missed that interview, please do send me that link!
  3. The “As seen on TV” icon. It’s nothing but an icon. If you want me to believe that you were seen by the news outlets listed in the other icons that follow, I want proof: link to the article or news feature. The About page on their actual sllaw.ca website has some convincing information on it, but to get there from their Facebook landing page, you first have to do that invisible leap to find out who they are.
  4. Same with the “Breaking News Alert for New Westminister.”  Again, without a link. I want verification, not just an unsubstantiated claim.
  5. Suggesting that banks generously participate in forgiving your credit card debt to prevent an economic melt down in Canada is a curious interpretation.  “Banks that have previously participated include” and then they list all five of the big Canadian banks. These banks don’t “participate.” They weigh their options. And if they figure they can get more money from you by way of a debt settlement than a bankruptcy, a consumer proposal or credit counselling, they’ll “participate.” And just as they weigh their options for the one that is in their best interest, so should you. Before receiving that single-option sales-pitched phone call.
  6. There is no privacy policy on the Facebook landing page (pictured here). Not that privacy policies ensure your privacy; the merely tell you how they use or sell your information. Most people don’t read them, but you should at least start scanning them. In this case, there’s not even anything to scan. They do, however, have a privacy policy on their sllaw.ca page.
  7. Canadians is spelled with a small  c. Oops. It’s a Big Deal typo.
  8. On their actual sllaw.ca site, their Debt Relief Options page has “coming soon.” I personally like organizations that are upfront with their resource information. If you list the link, provide the information. Besides, in  my former life as an information architect, “coming soon” is always a bad idea. You either have the info or you don’t, and showing that you don’t is not recommended.

There will be cases where debt negotiation will be your best option. Like if you have assets that you would like to hold on to, and if you have the cash and the income to support both the debt-payment schedule as well as the original debt-negotiation fee (I have no idea what these guys charge; typically it’s an-up front fee, but it may also be based on results).

Beyond their name and a link, I have no idea who this organization is, and whether or not they are good. Their About page does indicate some really convincing credentials. If you are considering debt settlement, they may indeed be the right choice for you. And they may not. Instead of filling out their FB form, I suggest you sit in the driver’s seat and phone them (866-599-3405) with your list of questions.

March 20, 2012

Free Credit Report and Score

Being in the business of debt and credit, I know for a fact that in order to get a free credit report, you must apply in writing to the two credit bureaus in Canada (Equifax and TransUnion) and you must include proof of identification. So I get a little bit weary when I see an online site telling you that you can get instant access, free of charge. Freecreditreportsincanada.ca is one such site.

  1. On page one, standard data collection: First name, last name, email address.
  2. On page two, expanded date collection: Same as above, and you must include your mailing address.
  3. On page three (see the image), a request for your credit card information.

Huh? I though it was instant and free.

Turns out, though, that it’s a 7-day free trial, and after that, you are charged a monthly fee.  So unless you actively cancel your account in seven days, you will be charged.

Which is fine if you want to monitor your credit rating monthly, but if this is the case, I strongly recommend that you directly through Equifax, not an information farmer. (Oh, and notice the TransUnion logo on the top right corner of the page? That doesn’t link anywhere, nor does it affiliate TransUnion with this information farmer. But it sure does look pretty official, doesn’t it?)

And again, buried in the fine print:

Your personal information will remain confidential and will be accessed only by our personnel and agents (including our marketers and telemarketers), the participating vendors that provide the Benefits and the organization that markets the Membership Program, including its marketing personnel. You agree that we may transfer your personal information to these entities. 

So who is the proud owner this information farming website? Coverdell Canada Corporation, also operating as FYI Direct Canada Corporation.

$10,000 Motherhood Scholarship

While this one is not specific to debt-relief, it is part of the information-farming and selling stuff I see out there. This one, “The Official Mom Campaign” offers up a $10,000 scholarship “just for moms!” Apparently, for no particular reason, either. Interestingly, the only real pre-qualifier that exists on the application form is that the person is 18 or older. Mmmm. Nothing about motherhood here!

So I read their privacy policy, which begins with the statement “Scholarships4Moms (“the site”) respects the privacy of our customers and is serious about protecting your online privacy.” Included in their respect and serious protection of your privacy, they also reserve the right to:

  • match your information with education providers
  • improve their site
  • for marketing and promotional services.

They also reserve the right to share your information with third parties, and they acknowledge that they have no control over how these third parties use your information. And then, buried at the very bottom is this little note:

At its sole discretion, Scholarships4Moms may transfer, sell, and/or assign information collected on and through this site, including but not limited to, the users personal information collected, to one or more third parties, as a result of the sale, merger, consolidation, change in control, transfer of substantial assets, reorganization, or liquidation of Scholarships4Moms.

So much for respect!

While the actual application has the standard information request, information that can pretty well be found in any phone book, what it does do is identify the applicant as female, over 18, interested in education, and probably a mom. That opens up the door to a lot of incoming calls, pressuring you to buy buy buy.

So, don’t, don’t, don’t fill out these silly application forms!

March 12, 2012

yourdebtreliefadvisor.com: Please be sure to read the fine print! Yourdebtreliefadvisor.com also sells your information. If you look at their privacy policy (http://www.yourdebtreliefadvisor.com /cr/privacypolicy.html), you will read the following:

Use of Personal Information and sharing with Third Parties

Many of our services involve the collection of personal information which is in turn provided or sold to third parties to contact you directly regarding their products and services.

Again, note the use of references to “As Featured In” The Vancouver Sun, AOL, News Canada and FOX. If you can find their “features”, please do let me know. I can’t find them!


March 10, 2012

Debt180.ca

I’ve included an image of the Debt180.ca Facebook Ad. They are using several really compelling marketing tactics, especially the call on authority: by using the image of Christy Clark (whoops! I almost wrote Campbell — trauma suffered during the Gordon years I guess… grin), Debt180 is implying that the Premiere of BC has actually approved the cuts to credit card debt. Nothing could be further from the truth!

Debt180.ca is currently running a Facebook campaign that reads something like: “BC Residents:  Canadian Banks forced to forgive up  to 74% of consumer credit card debt.  Find out if you qualify.” They are also running a very aggressive Google ad campaign. It then takes you to an official-looking landing page where you complete some information. Please note the following:

  • Beneath what looks like endorsements (“As seen & heard on…”) is a small disclaimer that reads: “The above logos are trademarks of their respective owners. These companies are not affiliates with and do not endorse Debt180 or its partners.”
  • A page hidden from view is their “Lead Purchaser Terms” (http://www.debt180.ca/lead-purchaser-terms.php), wherein it states that “Debt180.ca collects personal information, referred to as Leads, and sells that information to companies that offer debt solution opportunities to individuals.” Leads are sold at $75 per, and an order must be a minimum of 20 leads.
  • When companies such as these make comments like, “Find out if you qualify for this program,” “this program” typically refers to bankruptcy or consumer proposal. It’s not a program that’s going to end any time soon. So don’t rush into it. Gather information first. Then stop and think. And then act.

 

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