May 12, 2009

May 2009 Credit Counseling and Debt Settlement Alert Overview

2 min

Venable LLP is pleased to present the Credit Counseling and Debt Settlement Alert.

As lawmakers continue to address the nation's financial crisis, federal and state law enforcement agencies continue to crack down on debt relief companies that allegedly fail to comply with legal requirements and regulations. Although the legal landscape is shifting, opportunities for debt relief options and new opportunities for credit counseling and debt settlement companies to assist consumers continue to rise. For instance, one legislative initiative in the U.S. Congress would create a new Office of Housing Counseling within the Department of Housing and Urban Development. Also, many states continue to introduce and enact laws that allow, but regulate, debt settlement activities.

This alert provides a broad survey of some recent notable legislative initiatives, federal and state regulatory actions, and other developments affecting providers of debt relief services—including financial counseling and education, debt management plans, and debt settlement.

This alert contains the following articles:

From the U.S. Congress (click here to read the full article)

  • New Legislation Would Authorize the FTC to Regulate Debt Settlement; Hearing Held
  • House Subcommittee on Housing Holds Hearing on Foreclosure Rescue Fraud
  • Mortgage Reform and Anti-Predatory Lending Act Moves through Congress

From the Federal Agencies (click here to read the full article)

  • Federal Trade Commission
    • Coordinated Federal and State Law Enforcement Efforts
    • Using New Rulemaking Authority to Address Loan Modification Scams
    • Updates to the Red Flags Rule
    • Release of New Debt Calculator
    • New Advertising Guidance
  • Housing and Urban Development ("HUD")
    • HUD on Outsourcing by Counseling Agencies
  • Internal Revenue Service
    • Closing Agreements Highlighted

From the State Legislatures (click here to read the full article)

  • Iowa Amends its Debt Management Statute
  • Maryland Tackles Misleading Location Information in Telephone Directories
  • Montana's First Debt Settlement Regulation
  • New Jersey Works to Exempt Counseling Agencies from Debt Adjusters Act
  • Uniform Debt-Management Services Act on the March
  • Utah Makes Changes to its Version of the Uniform Debt-Management Services Act

State Investigations and Enforcement Actions (click here to read the full article)