On October 21, 2024, Minnesota Attorney General Keith Ellison announced that his office reached a settlement with two debt settlement companies to resolve allegations that the companies misrepresented their services and collected fees in exchange for promises of settling consumers’ debts before actually performing the promised services, in violation of state law Minn. Stat. § 332B.09. The Minnesota AG further alleges that the companies were operating in Minnesota without registering as debt-settlement service providers, as required by Minnesota’s Debt Settlement Services Act, Minn. Stat. § 332B.03.
As part of the settlement agreement, the debt settlement companies agreed to cease operations in Minnesota and provide full refunds to its Minnesota consumers. The companies agreed to pay Minnesota $1,081,756.59, which represents the total amount of payments the two companies collected from Minnesota consumers. Lastly, the companies agreed to pay a stayed civil penalty of $581,756.59.