Vision Credit Education, Inc.

It may sound like a broken record but another large debt settlement company has been seized following an investigation into company practices. Allegro Law LLC and Allegro Financial Services LLC have been shuttered by regulators with the assets coming under seizure by the court.

Allegro is one of many large debt settlement companies that skirt consumer protection laws. According to Alabama Attorney General Troy King, Allegro violated the Deceptive Trade Practices Act and the Sale of Checks Act.

Owner Keith Anderson Nelms plead guilty to violating multiple rules of professional misconduct. His Alabama law license was subsequently suspended.

Allegro failed to obtain a license from the Alabama Securities Commission, yet offered debt settlement services to Alabama residents. Approximately 175 of 15,000 total clients were Alabama residents.

Allegro made false, deceptive and misleading claims to customers in regards to its services. One such claim was that since Allegro was run by an attorney, that they would be able to achieve superior results over what other debt settlement companies could provide. The court came to a different conclusion:

Defendant’s debt settlement program failed to reduce consumers’ debt in most cases, negatively affected consumers’ credit ratings, and subjected customers to increased lawsuits and collection activities by creditors. It was deceptively unclear to Allegro consumers that Allegro Law would collect its fees in full before any funds were used to pay creditors.

In fact, the court found that instead of providing legal services as claimed, Allegro instead referred all cases to a third party that did not practice law, yet made claims to the contrary. This was a violation of the Deceptive Trade Practices Act.

These are the summary findings of the court in regards to Allegro:

(1)consumers were led to believe that Allegro Law, LLC was a law firm providing legal services, when in fact, consumers were not provided legal services; (2) consumers believed that Allegro was located in New York, when it was located in Prattville, Alabama; (3) consumers were not aware that they would be charged a fee of 16 percent of their total debt enrolled in the program and that 100 percent of their monthly bank drafts would go toward payment of that fee until the fee was paid in full; (4) consumers were deceived about the effectiveness of Allegro’s program and the certification of Allegro’s services; and (5) consumers were directed to stop making payments to creditors, which resulted in increased interest rates, late fees, further damage to their credit ratings, and additional and increased collection activities by their creditors.

Allegro clients are unlikely to see most of their money. It is unlikely that the court appointed receiver will receive substantially more than the $12 million seized so far. Splitting that $12 million between 15,000 unhappy customers would result in an average refund of $800. Once you count the legal bills of the receiver, the average could be far less.

For information about filing a claim for a refund, view the contact information for the court appointed receiver. Make sure you share your story so that you can warn others away from a similar fate.