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Debt relief lawyers sued – Orange County Register

ByTina R. Wimmer

Mar 11, 2021

A handful of law firms, including two with ties to Orange County, allegedly charged tens of millions of dollars in illegal fees to consumers seeking debt relief, the Consumer Financial Protection Bureau claims in a federal lawsuit.

Named in the lawsuit are Howard Law in Anaheim, Williamson & Howard in Irvine, and the Williamson Law Firm, along with attorneys Vincent Howard and Lawrence Williamson and Morgan Drexen Inc., all of whom ran debt relief operations . Morgan Drexen Inc. was shut down in 2015 following a CFPB lawsuit.

“The defendants exploited consumers who were already in financial difficulty by inducing them to pay high and illegal fees,” CFPB Director Richard Cordray said in a statement. “We have already shut down this scam once, and we intend to do so again.”

Debt settlement scams typically target people with credit card debt, promising to reduce the amount owed. According to the Federal Trade Commission, many companies try to collect fees before paying your debt, which is illegal, and do not explain the risks involved. a

The FTC advises never to do business with a company that: charges fees up front; touts a new government program; guarantees that he can make the debt disappear; tells you not to speak with creditors without explaining the consequences; or tells you to stop all debt collection calls and lawsuits.

The CFPB opened in 2011. It has filed 14 lawsuits against debt relief service providers and two payment processors. Some combinations named multiple companies.

Neither attorney immediately returned requests for comment.

According to the CFPB, debt relief providers are prohibited from charging fees until they have settled, reduced, or changed the terms of a client’s debt.

The defendants collected tens of millions of dollars in fees without settling any debt, according to the office.

The defendants also allegedly aided the illegal debt practices of Morgan Drexen and its chairman and CEO, Walter Ledda. In 2015, the CFPB obtained a judgment against Ledda for its participation in the illegal debt relief operation. In 2016, the CFPB obtained a judgment against Morgan Drexen for the same behavior.

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