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Refunds for Hess Kennedy Debt Settlement Scam Fall Short

January 20th, 2010 by Kenneth Long

Hess Kennedy served as a reminder that debt settlement companies hold very large amounts of their customers’ cash. It also showed us that sometimes that cash is siphoned off or spent by company executives rather than being used for promised settlements. In the end, customers received only a 25% refund of their deposits after a court appointed receiver shut down the company.

Refund checks began going out December 30, 2009 and most customers whose claims were approved received their refunds by the second week of January. Refunds were far less than what people were hoping for.

It is a real shame that these families were victimized in their time of need by a company that misrepresented its capabilities. These families were promised savings of well over 50% on their debt. Instead, they lost 75% or more of their deposits due to fraud.

From a consumer protection perspective, I really feel for these families. I know that they have been robbed in the worst way, and that many of these families will not be able to recover from this financial blow anytime soon.

One difficult part is watching customers believe the outrageous claims made by Hess Kennedy and other debt settlement companies. The claims they make are often in violation of several state and federal laws.

However, the most difficult part of this entire situation is knowing that these families could have avoided the loss if they had simply checked the reputation of Hess Kennedy before signing a contract. If they had, they would notice that Hess Kennedy had an “F” rating with the Better Business Bureau.

I can promise you that if you choose to do business with a firm that has an “F” BBB rating, you are playing with fire. It is the government’s job to protect you from rogue companies, and they reacted by shutting down the Hess Kennedy and issuing refunds. However, tens of thousands of customers were still victimized. It is your responsibility to protect yourself, because government protections are not enough.

Therefore, please let the pain of these victims serve as a reminder to verify the claims of any company prior to doing business with them. For one, making sure the company is a bona fide charity is one helpful step. Most importantly though, see what their rating is with the Better Business Bureau. I personally shy away from any company with less than an “A-” rating.

This entry was posted on Wednesday, January 20th, 2010 at 1:33 pm and is filed under Consumer Protection, Debt Settlement. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

16 responses about “Refunds for Hess Kennedy Debt Settlement Scam Fall Short”

  1. Janice said:

    Hi just reading your comment about doing some checking on our own to protect our selves. well i did i went thru “the achievable” they were in good standing with the bbb, they set everything up for me. so what am i suppossed to do???? i thought i had covered my ass but i guess i was wrong but that should not have cost me more than my original debt!!!!!!!!!! and now i must claim the remainder of the cancellation on my taxes!!! talk about being screwed!! if anyone out there can help please contact me………

  2. ImoJeanne said:

    My husband who is disabled signed up for Hess Kennedy thinking that it was a debt settlement company. First I attempted to file a dispute with our bank but was able to get only one payment back. Chase bank sued my husband for the total of over 6,000 and said he would be taken to court and had to pay their court costs. I paid Chase with my little retirement money to avoid damaging our credit. I understand that Chase forgave those with balances on their card after they received money from their lawsuit with Hess Kennedy. The receiver for Hess Kennedy said Chase did not get the full amount due them. I wonder if there is going to be a class action lawsuit against Chase for some reunibursement for the money demanded. Legally I do not think they could have taken money from Social Security checks. We got one small check from Hess Kennedy and they said there was not enough to pay more than one fourth, hoping can pay more later. I called the recovery dept. to see about this of course they did not have any information. What can those who were threatened and paid do?

  3. Amy said:

    My husband who is disabled signed up for Hess Kennedy thinking that it was a debt settlement company. First I attempted to file a dispute with our bank but was able to get only one payment back. Chase bank sued my husband for the total of over 6,000 and said he would be taken to court and had to pay their court costs. I paid Chase with my little retirement money to avoid damaging our credit. I understand that Chase forgave those with balances on their card after they received money from their lawsuit with Hess Kennedy. The receiver for Hess Kennedy said Chase did not get the full amount due them. I wonder if there is going to be a class action lawsuit against Chase for some reunibursement for the money demanded. Legally I do not think they could have taken money from Social Security checks. We got one small check from Hess Kennedy and they said there was not enough to pay more than one fourth, hoping can pay more later. I called the recovery dept. to see about this of course they did not have any information. What can those who were threatened and paid do?

  4. Kenneth Long said:

    Dear Amy:

    Your situation is unfortunate. Hess Kennedy was a debt settlement company, and it had an even worse record than the already bleak success rate maintained by most of the debt settlement industry. Credit counseling would have likely been a better option. I know it is tough sometimes when rogue companies make false representations. It can make it hard to know where to turn.

    Since you already paid, your situation is likely resolved. I cannot provide legal advice in regards to your situation. What I can say is that legal action at this point may be expensive and a longshot.

    Thank you for sharing your experience. By you providing evidence of your traumatic treatment by a debt settlement company, it might make other potential victims think twice before signing with one of those rogue companies.

  5. Anna Jones said:

    I worked for Hess Kennedy and saw settlements done. I worked in the settlement department and got settlements done as well. Credit card companies should also hold some of the blame for not working with companies like ours. As I can remember being told that someone having amnesia for 3 months and depleting most of his savings was not enough of a hardship to reduce his bill. In some avenues, our hands were tied. It was not set out to be a scam. Every day that I went to work, I went to help people.

  6. icclearly said:

    WOW really you “helped” people every day @ hess kennedy FYI i work for one of the larger creditors if not the largest in the country and we had a special DO NOT WORK THESE ACCOUNTS file set aside just for hess kennedy because thier game was to try and entrap us into minor violations of the law to then sue us knowing it is cheaper to discharge the debt to avoid suit, then to fight it and WIN!(even though we would have), the goverment got wind of your game and you are no longer in buisness =)…….companies like hess kennedy are the ones who ruin it for the rest of the industry that does buisness properly………i could like 100+ debt settlement companies we happily work with, your was the one we were told(more so then any other) to not work with………….you were a small fish in a big pond and never saw what was really going on…….think about all the shady stuff banks bill collectors and EVERY other buisness in the country does to make money they are all still in buisness! you have to be REALLY bad to the feds to shut you down

  7. Julie Strandberg said:

    I filed a claim and received a letter from the law firm representing the class action lawsuit members stating I was eligible for the amount I had proved I was scammed for. I called the law firm in the fall of 2009 and was told a settlement would occur around the end of the year. However, to this day I have not received any payment. I came across this website and saw where payments were made. I have since moved my personal files and do not have the copies, but certain they are somewhere. Does anyone have a number I can call to find out about my payment? Thanks.

  8. Kenneth Long said:

    Dear Julie:

    You will want to contact the receiver directly to inquire about your refund. There is a small number (approximately 100) that were supposed to receive refunds but the receiver was unable to contact these clients.

    Call 954-510-7840 or visit Hess Kennedy Receiver for more information.

  9. Emily said:

    Some of these people were not going to Hess Kennedy Directly. I myself went through Ameriprise who in turn hired Hess Kennedy for the lawyer portion of the work (escrows, legal filings etc). I had no idea who Hess Kennedy was until I got a letter stating that there was a lawsuit, and my Ameriprise representative would not return my calls.

  10. T. Fleming said:

    Anna Jones, you are missing the point. Have you ever been ripped off? It is not a good feeling to have someone take something from you! I don’t care what you saw. The point is, the company you worked for stole millions of dollars from people; people who were already hurting. You don’t do yourself any justice by trying to defend Hess Kennedy’s actions.

  11. Crystal Stewart said:

    This is a letter I just wrote the BBB

    I am writing this letter to BBB.org as a consumer. I dealt with a fraudulent debt settlement company (Hess Kennedy) about 5 years ago. I complained about the company on your website. You all did nothing. You closed the complaint in favor of that company, stating I was lucky the company didn’t sue me for breach of contract (although I had insisted THEY had breached). Thousands more consumers were subsequently ripped off. A simple investigation into the company’s history prior to changing names, and directors would have showed that the company shouldn’t have been BBB accredited or approved (Hess Kennedy had a A rating with you all at one point) There was also a story written about the shadiness of the company by a Montana news-reporter, named Jan Falstead.

    Consumers who are in debt are in a vulnerable and weak position, and unfortunately make snap decisions about how to resolve their debts. Thorough investigation ( because of time) doesn’t favor a consumer whose home is about to go into foreclosure, whose credit cards are about to charge off, or who is being threatened with a lawsuit/s. This is why consumers entrust the government, organizations like BBB, FTC, FBI, etc. to do what they can to combat fraudulent companies and protect the consumer by providing factual information regarding these companies. Every single entity, however, failed myself and thousands of other consumers.

    After doing some investigatory work, I later learned that there are only a few 100 debt settlement companies they are accredited and qualified to actually do the work Hess Kennedy claimed it was going to do. At that time, however, thousands of companies like Hess Kennedy had cropped up preying on naive consumers (like myself). Not a single government entity or non-profit agency (like BBB) did a single thing about it for a LONG time. Although it was not BBB’s responsibility to ensure that the companies the consumers dealt with weren’t fraudulent, BBB should have at least posted information on its website (in lieu of the amount of fraudulent complaints against companies like Hess Kennedy, and the dismal state of the economy) about debt settlement companies. This would have deterred thousands of consumers from dealing with Hess Kennedy, and shut that company and others like it down, long ago. You guys also had resolved a lot of those complaints in favor of those businesses (to give them the benefit of the doubt?), and even gave Hess Kennedy an A rating at one time just because they responded to you all. A lot more consumers checking the BBB for information about Hess Kennedy were fooled by this. What good is the BBB, if consumers cannot rely on honest, and factual information regarding these companies. I most surely hope that this has changed for the better. You all should require more than a simple response back from the company, or the companies’ lies in determining whether the company is okay for BBB accreditation or should have a favorable BBB rating. If this isn’t the purpose of your company, what exactly purpose do you serve then?

    Sincerely,
    Crystal Stewart

  12. Kenneth Long said:

    Dear Crystal Stewart:
    Thank you for providing such an honest and revealing look at your interaction with Hess Kennedy and the BBB. Unfortunately no company is completely transparent, which is why we depend on government regulators to shut down unscrupulous companies. We cannot fully investigate activities of a company on our own, so we depend on organizations like the BBB to aggregate complaints and to provide insight on a larger scale about these companies.

    As you have so shown, none of these protections are complete. We can only hope that more people will share their experiences (both good and bad) with companies that they have done business with so that others can read about their experiences prior to signing a contract with one of these companies. Thank you for providing your story.

  13. Hess kennedy | Kerilaborntera said:

    [...] Refunds for Hess Kennedy Debt Settlement Scam Fall Short | VisionHess Kennedy served as a reminder that debt settlement companies hold very large amounts of their customers’ cash. It also showed us that sometimes that cash is … Hess Kennedy served as a reminder that debt settlement companies hold very large amounts of their customers’ cash. It also showed us that sometimes that cash… [...]

  14. ImoJeanne said:

    l also wanted to know if anyone had any experience with Hess Kennedy and Bank of America. Hess Kennedy sent my husband a letter that they had gotten approximately 1776 off the bill. He is still paying for that bill and the amount Hess Kennedy claims never has been deducted. I sent another copy to the bank but it was returned (wrong address). I called to get the correspondence address.

  15. Kenneth Long said:

    Dear ImoJeanne:

    Unfortunately debt settlement offers only are valid with a lump sum payment. Your husband will likely have to repay the entire amount with accrued interest while making monthly payments.

  16. Anna ethridge said:

    Before signing up I too checked with the bbb, called all 3 of their recommeded debt settlement companies and got each of them to mail me a copy of their contracts, so that I could go through them with a fine tooth comb before deciding on who I would sign up with. I read and reread each one. I then signed up with “The Law Center” (aka Hess Kennedy which I was to find out later along with several other business names which just shows how much scamming they were trying to do). I worked hard for the $9000 that I paid the law center only to find out 19 months later, that they had not done ANYTHING but take my money! I’ve never felt so ripped
    off in my life! We’ve all paid too much for cars, furniture, jewelry, etc, but at least we could lay eyes on what we wasted our money on, but $9000 and all you have to show for it

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