Case 8:07-cv-01476-CJC

Transcription

Case 8:07-cv-01476-CJC -AN Document 70-3 F i led 06/1 8/08 Page 1 of 72 Page ID
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d odttt ~
UNITED STATES DISTRICT COURT
SEP 18 2006
FOR TEE DISTRICT OFMARYLAND
SOUTHERN DEACON
AI.YSSA POLACSEK et al., Indivfdnally
on behalf of the classes of similarly
situated persons,
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V,
hT G%'ENBKT
ttK Ug. DENCECQUttr
@STRICT OFLtARAAHO
Cas eNo.St
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DESTICATED CQNSUMER
COUNSELING, INC. et aL
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Defendattta.
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STIPULATED FINAL JUDGMENT AND PERMANENT IN
AS TO DEFEI k lDANTS DEBTW Q R K S, INC,, ANDMS PUKKE ,
D ZBTreATED ON S
iC
EON
MORS
dttt a tt
C.A N D
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ON
PUKKE,
FI N
The parties hereto, AndrisN. Pukke ("Pukkem), DebtVforks, Inc. ("D
orts"), Hriks
pukke, tteedcamd Conaumet Cnunaeiind, ine. ("Deetieated"i, andtufimly Rt!ao
i
Inc. ("IRG")', and Plaintiff Alyssa Polacsek and Plaintiffs- in-Intervention, S
es Group,
Leoni and
PeEcia Robinson (collectiveiy "Plaintiffs" ) individually and on behalf of a class onsisting of all
consumers in the United States who at any time after.Januaty 3l, l 998, aod thro gh October 7,
2004 (the "Class Period' ), received credit counsehng> credit repair, debt cons li tioo, and/or
•
•
debt management services from an ostensibly non-profit credit counseling a enc and whose
feeslprofits or contributions w'ere received, directly or indirectly, by Mr. Pu
or
a s td/
' The Complaint also names Pamela Pokke as a relief det'endant. Hotmer I aintiff-in
intervention excluded himself from this chss action. Plaintiffs previously set)edtheir claims
against The Sailenger Group, I.i C.
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Case 8:04-ov-00631-PJM Document 420 Filed01/09/200
d to entry of
DebtWorks and/or Debticated, by and through their respective counsel, have
u without trial or
this Stipulated Final Judgment and Permanent Injunction (" Order" ) by this
adjudication of any issue of fact orlaw, and without Defendants admitting li bil ty foranyof the
matters alleged in the
Complaint in
Comp
laint,the Complaint in Intervention, or the Amu
Intervention filed herein (col1ccti'vcly "the Complaint"'), cxccpt that Defenda ts tiptrlate that:
(1) any and ail funds and assets that comprise Receivership Property werc dcriv
paymentsby consumers as an alleged consequence ofthe actsaud practicesiIile ed in the
(3) those funds
Complaint; (2) the Defendants do not have a legitimate claim to thosefunds;
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are held in constructive trust for consumers,
urt for the
This action was filed on January 31, 2003 in the United States Distric,
Counseiing, Iltc.
Central District ef Cahfomia, captionedPohcseJ ct al v. Debricafcd Cordsq
er aL,Case No. SACY-03-0I003 CJC (th6 "Action'7, and was transferred to Il Court in March
2004, The Plaintiffs in intervention served a Complaint in intervention in A gu t 2004 and
a'
an Amended Complaint in Intervention in March200S(the "Amended Comp
tive claims
Plaintiffs have investigated the facts of this actljon and believe their
hsvs merit, hut hsvs sonsiudsd thst tniunstivs teiiei end resrituuon in ths sm ut t and under the
terms hereinafter set forth is in thc best interests of the class they seek to rep~
It. Defendants
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stipulate to the entry of this Order in order to terminate this Acuon and to eliVpin te further
expense, inconvenience and the distraction of burdensome and protracted htl ati
laims against
This Stipulated Final Judgment (thc "Order" ) settles only the Plaintiffs'
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Defendauh, and shalt not act as a bar to any claim by the Plaintiffs from see ng y fcmeiiy
against any other persons, corporations, or entities, including persons who m
subject to
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portions tif thh Order ns petsons «cting in active concert or participation wi
fendants, or
persons who are party to any iudemni6cation agreement with Defendants.
er, the Parties
have agreed that this Order sh«II be filed for approvai contemporaneously
e filing of a
Stipulated Pinal Judgmeltt and Permanent Injunction As To Defendants Deb
rks, Inc And
Andris Pukka inFed'erat Tnds Coemfssian j"ITC") v.AmerlDebt, Inc. ct
lvil Action No.
PJhl 03-3317 (D. Md.) (consolidated for trial with this Action) {the "PTC A o "). These two
consent judgmentsareintended to resolve all ciahns pending against Defend
in this
Action
and the PTC Acdon. In thc event that, for any reason, this Older is not ente
efelldants
agree and stipulate that the Order entered in the FTC Action remains 5nal as
e FTC and the
Defendants.
NOVI7,THEREPORE, the Plaintiff and Defendants having requesteII
this Order,
FF IS HEREBY ORDERED, ADJUDGED,AND DECREED as ftIIIo
1
I iiNDINGS
t
5 U.S.C. g
This is an action brought under (I) the Credit Repair Organizations A
fi
I 679 er sllq,, a federal statute providing for restitution for vio'lations o
provisions, (2)
California's Unfair Competition Law ("UCL") a st«tute that allows plainiffs to obtain
injunctive relief and to restitution for "any unlawful, unfair or fraudui nt usiness act or
practice
..." Cal.Businessand Proj ssionsCods $ 17200, etseq.,(3I
I
Clifornia's
Cocsc mam Legal Remedies Acs, CaL Civil Code 1 1770as sec ,cad i l) alifornia
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common Iaw, alleging fraud, breach of fiduciary duty, and unjust enriIJi ent; m addition,
PtaintiTfs have alleged fraudulent conveyances and sought the avoid ce f such
conveyances, and the imposition of a constructive trust under Maryland I
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2.
M is C ourt has subject matter jurisdiction over this acnon atid jnrlsdig over all parties.
Venue in the District of Maryland is proper.
3.
Any and all funds and assets comprising Receivership Property weree ved from
payments by consumers is «n alleged consequence of the acts and p cd
a l leged in thc
Complaint. Further, Defendants do not have a legitimate claim to th sc unds.
Therefor,any and allfundsand assetscomprishrg Receivership Pro
are held in
constructive trust for consmners as defined by applicable state law.
Defendants waive aU rights to seek judicial review or othcrwisc chaHn o r contest thc
validity of this Order.
5.
Pu r suant m Federal Rulc of Civil Procedure 65(d), the provisions ofis rder are
binding upon Defendants, their successors, and assigns„and theiroffi
, agents,
servants, employees, and attorneys, and upon those persons or entlti
ln active concert or
participation with them who receive actual notice of dus Order by
al service or
' otherwisc.
6.
p' visions. of
On J u l y 1 1, 2005, Pukke filed a voluntary petition for relief under the
Chapter 1 1 of the Bankruptcy Code, 11 U,S.C. $ 101er scq., in the U ite States
Bankruptcy Court for the Central District of California, Santa Ana Di is n("Pukkc
Bankruptcy Case" ).
7.
Su b sequently, thc Bankruptcy Court granted the FTC's motion to
venue of the
Pukke Bankruptcy Case to tbc District of Maryland, where it was doc
d as Case Ho.
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Case 8:04-cv-00631-PJM Document 420 Filed01/OS/200
05-2862-PSM. This Cottrt withdrew the reference asto the Pukke B
then stayed the pukka Bankruptcy Case.
g,
st ycd by ]I
Th i s Acdon, including the entry and enforcemcnt of this Order, is no
Q.S.C. ll 362 because this Court by an order has granted relief from Iti
u tomahc stay
{Document 0 l l I in Pukke Bankruptcy Case).
DERNGXONS
For purposes of this Order, the following defmitions shall apply:
l.
Thc " AmeriDebt Distribution Sharc" means that percentage of thc 8/tie ent Share of
of the
Roocircrrbip pmperrp enuei io ibe number of AmeriDebr ciionu rber icem cmbera
DcbWorks National Class divided by thc total ntunber of DebAVork N tional Class
inc mbers.
"Assets" means any legal or equitable interest in, right sc, or claim to, an real or
personal property, including, without Hnutation, chattels, goods, instrftin ats, equipment,
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fixtures, general intangibles, leaseholds, mail or other deliveries, inve to , checks,
notes, accounts, credits, contracts. receivables, shares of stock, interest i any trust, and
ail cash, wherever located, and shall include both existing Assets and s ts acquired
after the date of entry of this Order. Further, the deAnition of Assets
iliclude all
books, records, computer files, databases and other information that
e utilized to
determine thc existcncc of Assets, habihties, or the iocation of prope
3.
"Assisting" means providing assistance or support to any person or en
including, but
not limited to, providing any of the follovbiing goods or services; (a'l fo
lating, draftingc
providing, or arranging for the formulation, drafting, or provision of
material; (b) providing names of, or assisting in the generation of, pot
S
arkcting
customcrsl
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(c) performiug marketing services of «uy kind; (d) formulating, draf ng plovidings or
arranging for the formulation, drafting, or provision of any employ sc ipt; {e) providing
«ny training or training materials; ar (0 providing information, advic
nsultation, or
materials regarding businessopetationsg processes, or practices.
4.
"Class Counsel" shall mean Garrett M. Smith of Michic Hamlett Lo
asmusscn &
Twcel PLLC, David J. Vendlcr of Morris, Polich & Purdy LLP, and
S. Duncan,
who, subject to Court approval, shall act on behalf of all of the mern
of the class
certified herein with respect to aH acts or consents required of them '
at capacity.
"Credit counseling" means providing individualhed advice to a cons m r about the
consutner's credit, debts, or budget.
6.
"Debt management" means providing any service to a consumer rclaung
debts, including providing debt management plans.
7.
"Debt managementplan,m "debt management program,m or "DMP m
s a plan or
program that involves or purports to involve (a) a consumer paying o e nsolidatcd
periodic payment to the program to cover the debts that are included ij c program; and
Osy thc pragrsm riisbcming payments to ths crniitersof the conscmcr '
"Dabtstrorks" means defendant Debt%orbs, Ine., whmher sating directly r through any
corporation, subsidiary, division, or other device.
9,
"Document" is synonymous in meaning and equal in scape to the usage f the term in
Rule 34(a) of the Federal Rules of Civil Procedure and includes writiags,drawings,
graphs, charts, photographs, audio and video recordings, computer rcco , and other data
compilations from which the information can bc obtained and translat d, f necessary,
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through detection devices into reasonably ukable form. A draft or o er on-identical
copy is a separate document w'ithin the meaning of the term.
10.
11.
'"Net Monies" means all monies obtained by the Receiver after the R
ver marshals and
liiluidates Receivership Property and pays all approved compensatio
expenses.
"Person" means any natural person or organization including, but no
ted to, any
proprietorship, partnership, company, Qrm, corporation, joint ventu
ciety,
associadon, trust, or govcrnnrent agency or unit, and ariy other group
ombin ation
acting as an entity.
)
12, T h e "Polacsek Distribution Sharc" means that percentage of the Settl
t Share of
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Receivership Property equal to the number of DebWorks National C a Members that
were not AmeriDebt clients divided by the number of Debt%orks N
al Class
members.
13.
"Pukke Bankruptcy Estate" means the bankruptcy estate that was crea
pursuant to 11
U.S.C. g 541(a) upon the commencement of the Pukkc Bankruptcy Case
14.
"Receiver"or"Permanent Receiver"sha1lmean Robb Evans 8hAssets
LLC, the
receiver appointed by the Court in this matter over the Assets of DefeIr ts Andris
Pukkc and DebtWorks, inc,
"Redress Program" shall mean a program to be established and admi s red by the FYC
for the purpose of providing consumer redress as set forth in this Orddr.
"Receivership Property" shall mean any Assets, wherever located, tha) ar (1) owned,
controlled or held by or for the benefit of Pukke or DebWorks, in wh le rinpart;(2) in
the actual or constructive possession of Pukka or Dcbt%orks; (3) hcl by an agent of
Pukke or Debt%'orks, including as a retainer for the agent's provision
ervices to either
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nsttuotive
or both of. them;or {4) owned; controHed or held by, or in the actual
possession of, or othetwise held. for the benefit of, any corporation, p ership, trust, or
other entity directly or indirecdy owned or controRed by either Pukk
GcbtWorks,
including The P FamilyTrust, The P II Family Trust, and The pukka
2 Family
irrevocable Trust. Defendants agree that all Receivership Property c ns tutes assets held
for consumers in constructive trust as defmcd by applicable statelaw P ovided however,
that Receivership Property shall not include (I) income earned by Pukkolfront gainful
employment in accordance with Sections I, II, and XII of this Order ( ) funds given to
erive or
Pukke by his friends and family members, so long as such funds did
part,' arid
originate from Receivership Property,directly or indirectly, in whole
17.
"Rulc" shall mean a rule of Federal Rules of Civil Procedure,
I. SAN ON CREMT COUNSELINQ, CREDIT EDUCA.
OR DEBT MANAGEM ENT
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IT IS FURTHER ORDERED that Pukka and Debt%'orks are hereb p
restrained and enjoined from engaging in, participating in, oz assisting others
neatly
ngage or
participate in credit counseling, crelit education or debt management. Noth g in this Order
shall be read as an exception to this Section I.
H. PROHHHTKD BUSINESS ACTIVITIES
IT IS FURTHER ORDERED that, in connection with thc marketin of
y good or
service,
Defendantsaswellastheirsuccessors,assigns,oricers, agents, serv ts entployees, or
affiliates, and those persons in active concert or paiticipation with them who tp; Ye actual
notice of this Order by personal service ar otherwise, are hereby pcrtnanently s aincd and
enjoinedfrom:
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lication, any
m a king,causi
Or ng orassisting othersto make,'expressly or
false or misleading representation, including but not limited
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the existence, absence, terms, or amount of any fees, nt ibutions,
monies, or other costs, whether monetary or in kind, assoctatsSi
with the goods or services;
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2. that
nopro6ts are being made from thegoods orservtIcs rovided;
3.
an y restriction, limitation, or condition to purchase th gds or services;
4.
a ny aspect
ofd>c performance,efficacy,nature,orcen
charac'tcriatics
of the goods or services; and
9.
an y other matter regarding the goods or setviccs;
B. requestingor receiving payment of any fee or consideration f rg
ion from,orimpro
represented to remove derogatory informat
ods or services
person's credit
history, credit record, or credit rating until:
the time frame in which the defendant has represented I f the goods or
services wilt be provided to that persian has
expired; aid
the defendant bas provided the person with thc docum nt ion in the form
of aconsumer reportfrom a consumer reporting agenc
monstrating
that the promised results have been achieved, such report avtng been
issued morc than six months after the results were achi
requesting or receiving payment of any fee or consideration in
obtaining a loan or other extension of credit when the defend
represented a high likcHhood of success in obtahing or arran
extensionof creditfora person; and
ance of
guaranteed or
loan or other
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IIL MONirTARV REK,KF
IT IS FURTHER ORDERED that:
A.
Ju d gment is hereby entered in favor of the Plaintiffs and agai
tst ukke and
Debt%'orks, jointly aud severally, io the amount of ONE HUk) SD SBVSNTY
TNO MILUGN DOLLARS ($172,000,000) (the "Judgment'
gmcnt shao be
Rxcept as provided in.Secrions III.D. and IV of this Order, th
suspended if the Defendants satisfy thc following conditions:
1.
De f endants acknowledge that the Receivership Prope comprised of
and irruvocab)y
Assets held in constructive trust under applicable sta
assign, waive, release, discharge, snd dischim to the ai tiffs any and al)
right, title, interest, and claims, known and unknown, tha either
civcrship
Defendant has or may have in, to or against any and
however,that Pukke and anyone id g With. lllm
Property:proved
d at 31 Linda
may continue to reside at the Receivership Property 1
Isle, Newport Beach, California 92660 ("I.inda Isle prop y"3 undl ten
(10) days prior to the closing of a contract for sale of the ropcrty or 180
days after the date of entry of tlds Order, whichever oc u first, at which
time he and anyone r'esiding with him must vacate the ro erty, so long as
Pukka, and anyone residing at that address with him, ( ) f lly cooperate
with the Receiver's efforts to market and sell the prop '
including
granting the Receiver or its agents access to thc property show it to
!
prospective buyers upon twenty-four (24) hour telephonic oticc at
Pukka's telephone number to bc provided to the Recei er pon the date of
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entry of this Order, (2) do notinterferc with such sale a (3) do not by
fufrher that
action or inaction reduce the, value of the property; pr vf
idence at the
PuMtc may retain his personal furnishings
located in
Linda Isle property;
2.
Pu k kc releases and waives any statutory, common la, oother homestead
exemption, including tenancy by the entirety protnctio,
at may apply to
the LindaIsle ptupcrty or to any other real or pers p
petty in which
Pukke has any interest as of the date of entry oF this O dcjand shall not
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declare or claim any homestead exemption in thc Lin Islb Property, of
such other property. Pukke also releases and waives
tatutory,
common law or other exemption in any and all assets,
OEpersonal,
constituting Receivership Property;
3.
Pu k ke shall cooperate fully with the Plaiutrffs and be
preparing, executing, and recording thc neccss u4J doc
sible for
ts and taking
any additional actions thc Plaintiffs deem necessary or
evidence and effect the assignmcnt, waiver, release, di
ge, and
disclaimer to thc Plaintiffs of his right, title, interest, a
laims in, to or
against the assets constituting Receivership Property a
carry out the
purposes of this Order, and
Within three (3) business days of execution of this Ord
th Plamtiffs
and Defendants, Pukke shall file a motion in thc Pukke
ptcy Case
to obtain that court's permission to cuter into this Order
d take any aud
all actions necessary and appropriate to implement and
tuate this
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5.
Order. Anyplan of reorgatdsatioa ox liquidation pro
by Defendant
Pukko or otherwise confirmed in the Pukko Bankrupt
ase, pussuant to
11 V.S.C, $ 1129, shaB be consistent with thc terms o
s Order and shall
not modify or otherwiscsupersede this Order, includ'
e District
Court's exclusiv'e jurisdiction to interpret snd enforce
Order.
If t h e Defendants satisfy aII of tho.conditions dcscri
this Section
IILB. and ertcopt as provided in Secnons III JX and
is Order, the
Judgment against Defendants shall be suspended, and
Iaintiffs agree
that they wBI not participate in any distnbution to cre ito in the Pukko
Bankruptcy Case or Se a complaint for nondischargo bt ty or take any
other action to determine nondischargeabillty of tho J
ent owed to the
Plaintiffs under Section Ill>. of this Order.
If Defendants do not satisfy the conditions set forth iu Sectio II
The Judgmentshallnotbe suspended,andPukkc «nd eb Vforks shall
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owe the Plaintiffs SI72„000,000, an approlimato meas ro f the consumer
injury alleged in Plaintiff's complaint;
The Plaintiffs shall hold an allowed, general non-priority nsccured claim
against Pukka in the Pukke Bankruptcy Case for resti tid to consumers
that used the services of the following DoWVorks cGe
(I) Debticated
Consumer Counseling, Inc., (2) A Better%'ay Credit Co seling, Inc., (3)
••
Credicure, Inc., (4) Mason Credit Counseling, Inc., ($)
urn Credit
Counseling, Inc., (6) Newsy, Inc., (7) The Credit Hetw rk Inc., (8) Visual
Credit Counseling, Inc., (9) Preactive, inc., and {10) Dob
po, Inc.
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pursuant to 11 U.S.C. $ 502 in tbe amount of HIOHTQ
any distribution
DOLLARS ($86,000,000), and the Plaintiffs shaB re
to Which they arc eatitlcd under the priorities of the Ban ptcy Code in
thc Pukka Bankruptcy Case;
3.
pu k ka shall not oppose any rnodon by the Plaintiffs fo c appointmcnt of
«grec that they
a trustee in the Pukka Bankruptcy Case, but the Plain
eas the
will not nominate or otherwise propose the Receiver t
trustee; and
4,
Th e Plaintiffs reserve dieir right m file a complaint to
nondischargeability of the Judgment owed to them un er ecbon III.A. of
y such
this Order. Pukke agrees that the deadline for them fii
complaint to detetmine nondiscbargcability shall be u
to)and including
med inthePukkc
the effective date of any planconfir
ptcy Case or
the date ou which the Pukke Bankruptcy Case is clo
tchcvor is later.
f
D.
Th e Receiver shall marshal and liquidate the Receivership Pro ein accordance
with Section Ix of this Order, and turn over monies to the FT f
in accordance with Section IX.O. of the stipulated final order
thc Plaintiffs
eFfC Action.
If thc Nct Ivionies derived from liquidation of the Reccivcrsh'j Pr petty exceed
$35 million, thc Plaintiffs agree to accept THIRTY-PIVB MI
($35,000,000) iu satisfaction of its Judgment, and any Net Mo
$35,000,000shall be tumed over to thc Pukke Bankruptcy Bst
I N DOLLARS
exceeding
or distribution
in accordance with the priorities of thc Bankruptcy Code, Provtd d hawever that
lf for any reason the Receiver is precluded from turningover any et Monies to
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thc Plaintiff and the FTC «sset forth herein or such Nct Mo
afe detetniincd
to belong to thc Pukka Bankruptcy Estate, then (I) the Plain
hall hold an
allowed, general non-priority unsecured claim against Pukkn
e Pukkc
Bankruptcy Case for restitutionto consumers that used the s
of the
foHowing DcbtWorks clients: (I) Debticated Corgumcr Coun ing, Inc„ (2) A
n Credit
Better %«y Credit Counseling, Inc., (3) Credicurc, Inc„(4)
Counseling, inc., (5) Nexum Credit Counseling, lnc„(6) Ne ay Incfs (7) The
Credit Network, Inc., (8) Visual Ctudit Counseling, Inc., (9) re tive, Inc., (IO)
Debtscape, Inc. pursuant to I I U.S.C, ii 502 m the amount oflBI HTYSIX
M(LL(QN DOLLARS ($$0,000.000); (Sy lhn (SainSffs shall
snS
vn any
I
distribution to which they are entitled under the priorities of: e
Iankruptcy Code
y will not file a
in the P'ukkc Bankruptcy Case, and (3) the Plaintiffs agree th
complaint for nondischargcabHity or take any other action to
nondischargeabiiity except as provided in Section IV.C, of thip der, provided
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fgrdiar that Pukke shall not oppose any motion b the Plaintiffs fpr the
appointment of a trustee in the Pukke Bankruptcy Case, but the P aintiffs agree
that thc will not nominate or otherwise propose the Receiver to
e as the
trustee,
Any and aH funds paid pursuant to this Order shall be paid by le tronic funds
transfer pursuant to instructions provided by the Plaintiffs an th FTC for deposit
into the Redress Program administered by the FTC or its agen for equitable
relief including, but not limited to, consume'r redress and any tt
dantexpenses
for the administration of any redress mechanism. If this Iud
is entered, or
¹:1588
Case 8:04-cv-00631-PSM D ocument 461
F i l ed 09/18/20 Page 15 of 30
Case 8:04-cv-00631-PJM Docoment420 Filed01/09/200
Page 16 of 30
any related settlement receives final approval and prevails on
appeal noticed
from that settlement, the FTC and Class Counsel in this Acti
all agree upon a
program whereby the funds will be distributed fairly to chss
bers in the
DebAV orks National Class, and for plaintiffs' attorneys' fees
costs as
approved by. the Court!n this Aciiou. provided, however, tha
Plaintiffs
recognise the right of theFTC to object to the amount of atto
s fees and costs
ution to
requested by Class Counsel in this Action. ln the event that restl
I
r restitution is
consuiners is wholly or partially impracticable or funds remai
distributed, the FTC, in consultation with Class Counsel this
o ion, may apply
any remaining funds for such other equitable relief (including co urner
information remedies) as it determines to be reasonably rcla
t
practices as alleged in tbe Complaint, Any funds attributable
Defendants'
e Polacsek
Distribution Share shall, subject to Court approval be distributed o an appropriate
F.
recipient pursuant to thc cyprer docuine. Defendantsshall ha
o right to
challenge Plaintiffs' choice of cy pres distributions under this
section.
Bx c ept as otherwise provided herein, Defendants relinquish al minion, control
and title to the funds and assets comprising Receivership Prop
and to funds
paid to the Phintiffs pursuant to this Order. Defendants shall
e no claiul to or
demand for the return of the funds, directly or indirectly, through ounse1 or
otherwise.
AII funds paid pursuant to this Order are equitable monetary retie
restitutiauary in nature.
¹:1589
Case 8;04-cv-00631-P JM Document 461
F i l ed 09/1 8/20 6 Page 16 of 30
Case S:04-cv-00631-PJM Document 420 Fi/ed 01/09/2006 Page 16 af 30
IY. TERMINATION OIr SUSPENSION
IT IS FURTHER ORDERED that.
The Plaintiffs' agryemcnt to, and the Court's approval of, thi 0 cf as 'to
Defendants is expressly premised upon the truthfulness, acc c , and
comp)eteness of Pukke's and DebtWorks' financial conditio ~ represented in
financial
DebtWorks' financial statement dated May 2, 2005, and
statement. dated.January 5, 2006, upon which the Plaintiffs re i in negotiating
and agreeing to the terms of this Order. By agreeing to this
, Pukkc and
DebtWorks reaffirm and attest to the truthfulness, accuracy,
mpleteness of
these financial statements.
8.
lf , u pon motion by the Plaintiffs, this Court finds that any De cnd
«nt possessed, in
whole or in part, of record or beneficially, «ny Asset not disci se in Pukke's and
DebtWorks' financial siatements diat constitutes Receivcrshi P
perty and that is
exempt from the Pukke Bankruptcy Eitate, such Asset, or the
market value
thereof, calculated as of the date of entry of this Order or the at of turnover of
the Asset, whichever value is greater, shall be turned ovet' to c
eceiver or thc
Plaintiffs and the FTC by that Defendant within ten (l0) days lan shall bc used
I
for consumer-redress in accordance with this Order. Provkfe th tinaQ other
respects this Judgment shall remain in full force and effect un essodicrwisc
ordered by this Court, and that proceedings instimted under th s sction are in
addition to, and not in lieu of, any other civil or criminal rem i
as may be
I
provided by law, including any other proceedings the Plaintifh
enforcethis Order.
y initiate to
¹:1590
F i l ed 09/18/20 Page 17 of 30
Case 8:04-cv-00631-PJM Docurnertt420 F i led 01/08/200 Page 17 of 30
C.
Th c Plaintiffs reserve their right to fiie a coInplaint to deternune th
nondischargeability of any debt determined to be owed to the Pi ntiffs under
Section IV,K of this Order. Pukke agrees that the deadline f
e Plaintiffs to
fiie any such complaint to dcterlnine nondischargeability of s
debt shall bc up
to and including the effective date of any plan confirmed in titte ukke Bankruptcy
hichcver is
Case or the date on which the pukka Bankruptcy Case is clos
later.
I
V. CLASS ACTION PROVISIONS AND EFFECT OF
ll be amended as
IT IS FURTHER OROERED that Court's prior classcertificanons
authorised by Rule 23(c){l)(C ) in the following respects:
A,
ed based on
To I he extent that tbe classes previously certified herein
were
osc Persons who
the provisions of Rule 23(b)(2), such class definitions are modified to exclu I
elected to exclude themselves from the classes and who are listed with tire C u 's Final
Judgm
ent of Dismissal approving the Balienger Settlement (Documents @340,
B.
4l).
l n a ccordance with Ru]e 23(c)(3), the Court finds that the fol g ptrlvl sloe
describe the members nf the class to which this Judgment and Order ia appli
17
l
Case 8:07-cv-01476-CJC -AN Document 70-3 F i led 06/18/08 Page 1'9 of 72 Page'ID
¹:1591
Case 8:04-cv40631-PJM D o cument 461 F i l ed 09/18/20 6 Page 18 of 30
Page 18 of 30
Case 8:04-cv-00631-PJM Document 420 Filed01/09/2QO
"The DebtVIotks National Class is defined as incl di g all
31, 1998
consumers iu the United States, who sit any time after lan
aud through October 7, 2004, paid sn ostensibly non-profIt c t
cbunseling agency, directly or indirectly, any rnonay' orolhe valuable
consideraticn whatsoever (whcthcr denominated as a "volnn
contribntibn" or otherwise), in consideration of or rclatiu in y way to
thc performance ofany servicefororon behalfofthe no -p fit credit
couitscting agency, including, without limitation, debt co soldamon or
debt management plan services and who had n portion of a money or
other consideration benefit, directly or indirectly, DebtVf r ks, Inc. The
subclass shall bc-referred to as the "Deb(%orks ¹tional ttl s" as this
Mgation proceeds and in any notice to class members."
C.
To t h e extent that the classes previously certified.herein wc certified
baseduponthe provisions of Rule 23(b)(3), such classes are decertified
al injunctive
relief is appropriate,
0,
Th e ciassea formerly certified and defined as the Debtica dauonat
Class,the DebtWorks California Class, and the Debticated California Class sre
decertified on the basis that they are superfiuous,
B.
Al l rcs t i'tution distributed pursuant to the terms of this n cnf
judgment shaH bc apportioned equally among the class members.
F.
The cl a i ms adjudicated by in this Order shall bc distincand severable
I
froJnany claims advanced by theFTC in thcFTC Acdou aud resolved b th consent
judgment entered therein. lf the Court or any appeals court shoutd deccrufy e
DcbWorks National Class, or otherwise defeat the purpose of this consc tj dgment, that
decision shall not affect the implementation of the Redress program as it pp ics to the
AmcriDebt Distribution Sharc. Nothing in this Order shall be used as evi ence against
the Defendants in the FTC Action.
18
¹:1592
Case EQ4-cv-00631-PJM D o cument461
Fi l ed 09/18/20
Page 19 of 30
Case 8:04-cv40631-PJM Document 420 Filed01/09/200
Page 19 of 30
ION
VL COORDINATION WITH FEDERAL TRADE CO
National
IT IS FURTHER ORDERED that class tnembcrs in tho Debt
Class rocciving payment of monetary relief through thc FTC Redress P
shall be
notified that such payment also constitutes restitution fur the Debf%orks
ional Class
pursuant to his judgment. The FTC and Class Coulel shall negotiate
content and manner of dissemination of such Notice as may be appropri
der Rule
23(b)(Z), and/or thatmay be required under Rule 23(h) (thc "Notice" ). Siu
proposed
Notice shall be submitted to and approved by the Court. Upon approval f
h N o t i ce,
I
ibution to
the FTC and Class Counsel shall negotiate and agree upon the tnanner o
of resutution to members of DebOVorks National Class. TheDebt%or4 N tional Class
and Class Counsel shall be ultimately responsible for all costs associated wi the Notice,
but may seek payment of such expenses under to Section lX. 0 below. m iarly; thc.
ts associated
Debt%forks National Class and Class Counsel shall be responsible for ail
with further proceedings in this Action relating to purported objections, a
peals or
requests for exclusion ("opt outa") from the Class. Tho Dcbt%orks Nati na Class and
C's Redress
Class Counsel shall not be responsible for any costs directly related to th
Program (s.g., tho FTC's delivery of class restitution to consumers)
VK REDRESS PROGRAM ADMINISTRATION
IT IS FURTHER ORDERED that the Redress Program cstablis cd
administered by the. FTC pursuant to the final order entored in thc FTC Agtion shall
e FTC, in
provide the AmcriDcbt Distribudon Share of class restitution to consumers,
consultation with Class Counsel shall dctcrnuno the plan for the disburse
t of the.
I
idt
foods to memtters of the DetrtWortss Nadoo at Class. 'ttte FTC, io t ts sote
19
on, shall
¹:1593
F i l ed 09/1 8/20 6 Page 20 of 30
Case 8:04w-00631-PJM Documertt 420 R ied 01/QQ/200
Page 20 of 30
aasign
the administration oftheRedressProgram to oneofit
sapproved co tr
Ogress Program Administrator), Defendants shallhavenorighttoco t
the
substance or manner of distribution of redress (including any attendant c
), nor the
Administrator.
rogram
FK's selection of thekcdress P
VM, COOPERATION. VGTH CLASS COUNSEL
IT IS FURTHER ORDERED that Pukka shall, in connection
is Action
and in connection with thc Pukke Bankruptcy Case, cooperate in good faith ith the
Plaintiffs and Class Counsel and shall appear at such places and at such m s as Class
Counsel shall reasonably request for interviews, conferences, pretrial dis v ry, review
Iaintiffs. If
of documents, and for other tnatters as may be reasonably requested by
requested in writing by the Class Counsel, Pukke shall appear snd pro vi e
timony
under oath in any vial, without the service of a subpoena. Cooperation b
kke shall
not require Pukka to waive his constitutional right against self-incriminattonI
l
counsel.
IX. OTIIKR PROVISIONS
IT IS FURTHER QRDERED.that the asset recovery benefits o th
Receivership Provisions„aud the Maintenance of Asset contained in thc ftna order in the
PTC Action filed contemporaneously herewith arc intended to benefit thd D tWorks
National Class
Plaintiffs do not object to the Receiver's payment to Jones Day oricontest or seek
disgorgement of payments previously received by the Jones Day'law firm or oilier
Shannon Scott, as more fully described in Sections IX C and D of the fin o der in the
FTC Action.
20
¹:1594
I
M D o c urnenAN= FiMd 09/18/20(I6 Page 21 of 30
-cv
ase :
Case 8:04w-00631-PJM Document 420 Filed01i09/2008 Page 21 of 30
Pursuant to Rule 23(h), Class Counsel may move tbe Court for aiI
m award
of expenses of litigation to be paid by the Receiver. The Coun wilt set a
e, for Class
Counselto move foran award ofattorneysfees,stipendsforclassrepres
tives, and
any unpaid expenses prior to distribution of restitution to DebtNorks Na ' al Class
member, and notice of such motion shall be included with such distributi
X. ACKNOWLEDGME NT OF RECEIPT OF ORDER
I
icss days
IT IS FURTHER ORDEREDthat Defendants, within five (5) bttstn
I
afterreceiptofthisOrderasentered by the Court,each must submitto thePlaintiffs a
truthful sworn statement acknowledging receipt of this Order.
XI. DISTRISUTION OF ORDER SV DEFENDANTS
IT IS FURTHER ORDERED that, for a period of tive (5) years
entry of this Order, Defendants shall deliver copies of thc Order as direct
A.
rhe date of
elowi
De b tWorks shall de/iver a copy of this Order to all of i 'ncipals,
officers, directors, and managers. DebNforks shall als d liver copies
of this Order to all of its employees, agents. and repres n
ves who
engage in conduct related to the subject matter of the 0 dc . For
cunent personnel, delivery shall be within five (5) days
rvice of
this Order upon Debt%orts. I""or new personnel, deliv
hall occur
prior to them assuming their
res
ponsibilities.
For any business that Pukke controls, directly or indi
or in which
Pukke has a majority ownership interest, Fukke shall d i
a copy of
this Order to all principals, officers, directors, and man
of that
business. Pukkc shall also deliver copies of this Order
¹:1595
Fi l ed 09/18/206 P a ge 22 of 30
Case 8'.
04-cv-00631-P JM Document 420 Filed 01/09/200
Page 22 of 30
employees, agents, and representatives of that busing w o engage in
conduct related to the subject matter of Sections l and
the Order.
For current personnel, delivery shall bc within five { da s of service
of this Order upon Pukkc. New personnel shall bc gi n p ica of this
Order at least one(I) business day before they start w
C.
F o r any business where Pukka is not a controlling per
n of the
business but otherwise engages in conduct related to e s bject matter
of Sections l and II of th Order, Pvkke shall deliver a cop of this order
to all principals and managers of such. business before ngaging in such
conduct.
D.
De f endants shall secure a signed and dated statement owlcd ging
receipt of the Order, within thirty (30) days of deliv
persons receiving a copy of the Order pursuanttothis ec ion.
XII, AUTOMATIC STAY
IT IS FURTHER ORDERE9 that, to the extent necessary to cfec atc ilia
provisions of this Order, the ant'omatic stay in the Pukkc.Bankruptcy Cas
uant to i l
U.S,C, ) 362 shall be and hereby is terminated as to thc Plaintiffs.
XIH, APPROVAL BV THE COURT
IT IS FURTHER ORDERED that,
A.
T he De btWorks National Class defined above shall constiut and be
referred to herein (thc "Temporary Settlement Class" ), a mandato
ttlement
class solely for pprposcs of considering and Anally approving thisSe tiemcnt
Agrccmeot;
8,
To t h e extent ttus Order constitutes a class action scttlemaa
t t h i n the
meaning of Rule 23(e), the Court gives it preliminary approval;
.Case 8:07-cv-01476-CJC -AN Document 70-3 Filed06/18/08 Page 24 of 72 Page ID
¹:1596
Page 23 of 30
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Case 8:04-cv-00631-PJM Document461
Page 23 of 30
Case 8®4w-00631-P JM Oocument 420 Filed 01/09/200
C.
T h e Court appoints thc Temporary Setdemcnt Class Rcp
r«presentatives of the Temporary Settlement Classes;
D.
lass
Th e Court appoints appointing Class Counsel
s»Settlern
Counsel;
E.
Th e Court directs Class Counsel to prepare a plan of noti ceptable to
the FTC and Settlement Class Counsel and to submit the proposed. ntents of
such Notice including the date of the Fairness Hearing, as defiu b low, and of
the dates for filing any objections to this settlement;
F.
Th e Court directs that a Fairness Hearing be held to detc
fairness,
reasonableness,and adequacy ofthesettlcmcntcmbodi
i this Order,
and to consider whether thc Court should issue a Final Settlement A roval
Order(s); and
Q.
ter the date of publication of the N
A r easonable
p af
eriod
and Temporary Settlement Class Representatives shall ntove the
Defendants
rt for entry
of a Final Settlement Appr'oval Order(s);
l.
giv i ng fina) approval of this Settlement Agrecmen
2.
dec l a ring tbe Temporary Settlement Classes shall
cPermanent
Setdcment Classest
3.
dis m issing this case, not later than ten (10) days af e last day
on which the Temporary Settlement Cl&s Representativesor efendants
may withdraw from the Settlement Agreemcnr as set forth el w; and
rcserviug jurisdiction over the implementation of this Senl
nt
Agreemcnt for all purposes and over the resolution of any
utes that
may arise.
¹:1597
Filed 09/18/20 6 Page 24 of 30
Case 8:04-cv-00631-PJM D o cument 461
Page 24 of 30
Case 8:04-cv40631-PJM Document 420 Flied01/09/200
XlV. WITEDRAVfAL
rr XS FURTHER an)ZREDthat,
A.
De f endants shaH have the right to withdraw from this Se l
Agreement in each of the following circuthstances:
l.
lf t h e Court refuses to approve this Setdement Ae ant (or to
I
enter any order as provided herein) and if Defendants and the TeInp
Settlement Class Representatives, having used their best efforts iIt good faith to
agree upon a substitute scttlcmcnt agreement taking into account lan suggestions
enty (20)
of the PTC and Court, are unable to reach such an agreement wi
days of the ruling by the Cotut;
a)
Bxcrc i sc of the right of Defendants to withdra m this
ndersigned
Scttlentent Agreement shall be effective upon service on
counsel for the Temporary Settlement Class Reprcsentati cs f written
notice of the election to withdraw and filing a copy of suc n tice with the
Court. If Defendants exercise their right to withdraw, neith
concernintgMs Settlement Agrcemcntnor th
negotiations
ms thereof
shail consdtute matters that can be used in any way iu this c
I
otherwise, and this Settlemcnt Agreement shall in all othcl
and void,
ts)
pects bc null
Represeatativetjunta
Tem p erary settlemeet class
y(but not
individually), ou behalf of all Tcrnporary Settlement Class
hall have
the ri'ght to withdraw ftum this Setdcment Agrccrnent if l)
Court
refuses to approve this Settlcmcnt Agreement (or to enter
provided for herein) and if the Temporary Scttlcmcnt Clas
Rcprcsentadves and Defendants, having used their best ef
in good
faith to agree upon a substitute settlement agreement, ta
to account
arly suggestions of the Court, are unable to reach such an a
ent
¹:1598
F i l ed 09/18/20 Page 25 of 30
Case 8:04-cv-00631-PJM Document 420 Flied 01/09/200
Page 25 of 30
witlnn t wenty (20) days of such reling by the Court or 2)
cndants
breach «ny tenn, covenant or provision of this Setttcmen
ment,
c)
Exerc ise of the right of Temponuy Settiemcn
Representatives to withdraw from this Settlement Agree
shall be
effective upon service on the undersigned counsel for De
such notice
written notice of the election to withdniw and filing a co
l
with the Court. If Temporary Settlement Class ReprcsenuIti s exercise
I
their right to withdraw, neither the negotiations coneernin|g s Settlement
be used
Agreement noi' the terms thereof shall constitute matters t
iu any way in this case or otherwise, aud this Settletnent
entshall
in all other respects be null and void.
d)
Withi n thirty (30) days of the service of the no cof
withdrawal of either party, the Folacsck Distribution Shar o the
settlement proceeds (plus accrued interest) shall be return
Rccelvef.
1
l
XV. RELEASE PROVISIONS k CLOSING
IT IS FURTHER ORDERED that,
A.
Th r ough their execution of this Order, Class Counsel, Tempo
Settleinent Qass Representatives expressly covenant and agreethht hen this
Order becomes final as specified below, «0 permanent Scttlernen
s members,
and eachofthem, «hailbe deemed to havecovcnantcd and agreed to rc
foreverfrom instituting, maintainhig, prosecuting oi centhtuing to, 'm mnun or
prosecute any suit or action against Defendants based on the folio in
"Claims" );
8.
claims (the
!
A n yclaim or claims in law or equity arising under any fed or state
laws between January 31,1998 and October 7,2004,based upon e acts alleged
in the complaints filed in this case or which might have been rais b
the Class
¹:1599
Case 8:04-cv-00631-PJM D o cument 461 F i l ed 09/18/2 6 Page 26 of 30
Case 8:04-cv-00631-PJM Document 420 FJled 01/09/2008 Page 26 of 30
Representatives iii their lawsuir, or based upon the provision of
t counseling,
credit repair, debt consoHdation and/or debt management service t
Temporary Settlement Class
C.
VA ' th respect to the Claims described in above, this cove nwaiver slid
releaseshaHapply to any suits, debts, liens, contracts, agteements. otniscs.
liability claims, demands, damages, losses, costs, expenses, or a
cys' fees of
any nature
wh«tsoevcr,known orunknown,5xcd orcontingent, s ected or
claimed, which Temporary Setdcmcnt Class tnembers ever had ai st
DefendantsTemporary Settlement Chas mcinbcrs expressly wai e e provisions
of California Civil Code 51542 which tuads as follows; "A gen 1
fease does
not extend to claims which the creditor does not know or suspect to xist iii his
favor at the dme of executing the relcasc, which if known. by hi
st have
Inaterially affected his.settlement with the debtor."
D.
Th i s Order and shall become fhial upon the expiration of eme to file a
notice of appeal from the final Order in this case, if such nonce o a
eal has not
been timely filed: or
E.
l f a n o tice of appeal from this Order has been timely fded th
immediately upon affirmation of such order or other action upholdiu the Eihal
order by the United States Cdurt of Appeals for the Fourth Oreui
, if review
is granted, by the United States Supreme Court,
F,
Up o n these terms becoining final as specified above, this rd'er
1.
Sha l l jointly and severally inure to the benefit of d hall jointly
and severally bind Mrs. Pukkc and her estate, heirs, beneficiaries, sucessors
I
personal repneenratives, assigns and lcg«1 representatives; and
2.,
S h all jointly and severally inure to the benefit of debmding
upon the Temporary Settlement Class Representatives, all mein s f the
Temporary Settlemeni Classes who did not ti mely elect in wiitin to e excluded
26
¹:1600
' Case 8:04-cv40631-PJM D o c ument 461 F i l ed 09/18/20
Case 894wv-00631-PJM Document 420 Filed 01/00/2006
Page 2? of30
age 2? of80
there from, and their respective present or past officers, dizectots,ag nts,
employees, parents, subsidiaries, predecessors, «ffiliatcd businesssu 'lvlslon and
their respective successors, assigns or legal representatives,
XIV. NOTIFICATIONS
IT 18 FURTHER ORDEREDthat, for purposes of this Order,
unless othervsise directed.by Class Counsel, mail all written notifications
Counsel relating to this Order to:
Garrett M. Smith, Bsq.
MtCHIB HAMLBTf LO%RY RASMUSSBN k TWSBL
P.O. Box 298
Charlottesville, YA 22902
For purposes of this Order, the Plaintiffs and Receiver shall, u
provided by this Order or otherwisc directedby Defendants or their auth
representatives. mail all vrritten notificatiens to Defendants relating to thi 0
cr lo:
John B. VA'lliams, Bsq.
Geoffrey S. Irwin, BsIl.
JONBs DAY
51 Kuuisiana Avenue, N.W.
%'ashington,D.C. 20001
XIX, RETENTION OF jUMSDICTIGN
LT IS'FURTHHR ORDERED that this Court shall retain jorisdicti n f this matter
for all purposes, including construction,inodificatlon and enforcement of hisOrder.
rr IS SO ORDERED.
E8 D TRICT COUR
27
¹:1601
Filed 09/18/20 6
Case 8:04-cv-00831-PJM Document 420 Flied01/09/200
S'fB''tJLATEO.AI4D AGREED VOSV>
8emC . Smith,
PILC
500 CaortSquare,8olts300„P.O; Box298
Chsrlottesvglo,VA 229tt24Z9$
Telephone: (434)951-7222
(434) Nl-7242
Facsiullle:
David I. Veo@er, lh
asa.(ho haevice)
MORRls, POLtCH
BhPURDY LKP
l055%'estSeveath Stteet,24+ Hoor
Los Aattates,Califottda KO) 7
Telephone: {213) II91-9100
toacsiotile (2$5) 4BB-1
1'lB
Oreitory S. Doaosn-Esp, (Pm,hse vioe)
412 Pec Jefthtsoe Street
ChettottesvBle,VA 22902
Telephone: {434)97M556
Faoslmile: (434) 9799766
Attorneys for Pltaoti6' ALV8S A, POLACSHK,
Phtint'df hterveners,SA14Qi'LBOM .
'dt PBXZCIA ROB%SON
indi
vidually,aad oa behalf of the olasses of sbaltsrly situated jersoas
I
Page 28 of 30
age 28 of 30
¹:1602
Case 8.'04-cv-00631-P JM Document 420
By;
Filed 09/1 8/20 6 Page 29of 30
Filed 0't/09/200
Page 29 of30'
s P u kke, IndividuaHy, and
as
d of Debt%'orks,
hc., and Inanity Resources Group, In&
.Ciuqiter lU3ebtor
By: Jo
Geo
,
atns , Bsq.
Attorney for Andris MRe «nd DebtWorks, Inc.
And Special Counsel for Debtor Andris pukka
JoNB8DAY
51 Louisiana Avenue, N;W,
Washut8ton, DC.2000i
(202) 879-3NS(telephone
.)
(202) 626-1700 (SaoshnHe)
Counsel to Defendants, Andris N, Pukka, Debt%forks, Ino„and I
hQnityResources Group, Ine.
By-: -Hriks Pukke, Individually, and as
president of Debticated Consumer Counseling, Inc„
Robert 8, Chant, Esp,
Purey Doohnjt ® AbeH„LLP
8401 Conneotiont Avenue
Suite $100
Chevy Chase, Maryland 2081S
Counsel to Eriks Pukke andDebticsted Consumer Counseling, 4.
¹:1603
Case 8:04-cv-00631-PJM
~ ~~ ' tNSb fN'4%v-00631~
Do c ument 461 F i l e d 09/18/20 6 Page 30 of 30
%$ 5 !H R - 4 20 Filed 01/09/200
gPSiRF80 " ~
Sy; Andns Pukke, lndtviduaHy, andas
Presidentof Debt% orks, lno„and h8nity Resources (houp, kc.
and as Chapter t l Debtor
By: John B, %iillturts, Bsq.
Qeotkoy.s.lpein, Hsq.
Attorney for Andrisgukke audBebtgorks, Jnc.
And Special Counsel for13ebtor Aadds Pukke
JONESDAY
$1 Lol@1MaAYenue~N.V.
Washington, ix',ZON>
(20Z)879-3N'8(telephone)
(202) 626-1709 (facsitnile)
I
Counsel to Deibndants, Andris N. Fake,9ebtWorks, Inc., and
iafiaityResoutues Oro
>, hc.
By; Saks
cf
, lndisidually, and. as
ti
er C o unseling, Inc„
bert E Orant,
y Doolau A Aha, U.P
840t Connectieut Avenue
,Siute l l 00
Cmg Chase, Maryland 20$$$
Counsel to Erlks Pukke and Dcbticatcd Corsumer Counseling, Lap.
I
¹:1604
s
of 72 PN„y q3
18 C ao
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I do not agree ro make these carLaibuCiorLs ro Ameridebr.
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"please make sure you yrovi5je current statements of your credit au'4 biHs, to ensure
I s nswucuxl Xl i » tIRpo ~r
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''Cilia ~gl eewera c back to p'oM' ooujrseior.
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along vrith your payervwrk.
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0 9/18/2007 TU8 16 : 0 6
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Cal/Noui
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ln l5 inlnutes or legt
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or click hare to apply onNne
'Contact.lls,
4h;NIriij
Re canPtelpgoQ
Reduce mlnimutu payments, as much us 50%
Consolidate your multiple pay<nants into one
simple mohthly payment
Hlmlnate or reduce. interest rates
Nlminate late chaages and over the lbnit fees
Ru-eginI of past due accounts (lirinlilnN accoimts
to current status arith creditor/
Hame
nwners «i'
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Who We Are ) Our Services l Apply Online
Credit Report l.Debt Facts t.i)ebt Calculator l.FAQ
News Media ) Contact Vs l Home
Existing Clients Home Page
Privacy Statement
Copyrlght@Ameridebt,Inc.
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Wh'o WeAre
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'AmeriOebt works directly with your cnxlg& to crests.the
. Ipes I repayment plan' for yon, pince Aineiloasl ls a non
prollt agency, creditois are wiging to offer our dients
numerous benefits, such is:
,
p Riduc5on in minimum palnnents, as much as yi0%
s Consolidation af multiple paymetds Inta one simple
»%cws'lkedla
monltyy payment
• Reduced or elhninated interest rates
• Hlminadon of Lite charges and oyer the lknit fees
• Re-aging of past Cue accounts (Bringing accounts to
current status with creditor)
Program Steps
X. Your spedagzed counselor will review your budget
information and suggest one of aur debt inanagement
programs. Mast credit counseling companies oNer few
t
sm r
options, whlh Amarldebt leads the lndusby with many
solutionsfaryourindividualneeds. Ne can even referyou
to a fender altar completing 7 months of on-time and ln
full paymenis to apply iar a debt consogdatlon loan.
However,we cannot guarantee you a loan since apptaval
ar denial is the saltt right of the lender. lifgh these unique
programs and tap rated customer service, Ameridebt ls the
ieadlngchoke &r jour personal 5nandal needs.
2. AAer decks'g which program will be the most
banefldal,
youwN-decide when you wll be tnaldhg your
first payment ta AtnetlDebt. You wN have one easy date
that WNI be your payment date every month. There will be
no-more dilfsrent due dates to remember or budget forl
3. If alter dlscusslng your finandal situation with your
counselor yoa dedde to enroll ln our debt management
pragmm, AmerlDebt will contact your creditors and
negotiate wllh them ta have your monthly payments
lowered and your interest rates reduced. You than sknply
send one reduced tnonthly payment to hmetlDebt and vte
distribute ihe funds to your creditors on your behalf. You
wIl still receive your monthly staternenis, so you wiI see
. your balances Chopping. If any of your creditors contact
you, you can direct them to AmetiDebt. Yau'll be assigned
a personal account specialist to deal with any tiuestions or
situations that may atise.
httpilwww.sraeridebt.erg/ouzsstviccahtml
1RS - BX - 0002388
AD-LlT-002601
¹:1609
4. Simplykeep making yourm onthly payments on time
and you will be on the read to a better credit rating, stable
finances andeliminating yourdebtl
{The initial repayment. plan Is subject
»' fo adjustment based
ofr creditors' individual requfremenfs Arnerfoebt wllauCfy
you when more paylnent nafy be required to satfsfy
credito& needs.TheeIs no industry standawf'as to what
benefits creditors wN extend to AmerlDebt's Dents, so
every repayment plan depends in part on which creditor is'
involved.)
'I
Results
As a result of the benefits that we can achieve for you, you
will be able.to pay. off your debt in much less time than
you could on your own.
Our average dfent maintains a $10,000 debt with an
18.5% interest rate. Without AmerfDebt, by payfng the
monthly minimum payment, it would take at least 32 years
and 424,509 to pay off the original debt.
lVlth Amerfbebt that same cIent's debt wN be paid off
much sooner:usually.3 to 5 yeafs,even with the reduced
monthly payrnentsl
Howl' interest roti reducUons, consistent on%me .
payments, and reduced late charges work. together to
effiectfvefy shrink the t'ofaf balance owed. Before a dient
ed
jolts AmerfDebt, most of.bfs or her payments areappm
to Interest charges. This barely changes the balance
amount. By ieducfng the Interest, you can pay off the
balances ln a lot less ffmef
- The Debt Nanagement Program ls also designed to provide
you with easily accessible help end guide|foe. Our
counsefors are avalfable to handle harassing phone calls
fmm cfedltors, assist you with legal situations and teach
you how to fhndle credit in the future. Our counselors also
make budgetingsuggestions sothatyou can.'
save more
money eachmonth and spend your earnings moie
-efffdentiy.
Po you think you'd be better off declaring
benfcruptcyT
Arnerioebt can probably help save you those court casts
and the loss of precious assets. Please talk to one of our
counselors if you are considering banfouptcy to find out
aboutth'e alternatives.Ne can directyou to bankruptcy
assistance if that Is the best solutfon for your specific
situation.
Ne're here to find the best way to get you back on thick
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IRS - EX - 0002389
AO-LIT-002602
¹:1610
and debt freel.
Click Here to Apply Online
Who We Ari ) Our $ervices t Apply Online .
Credit Report t Debt'Facts l Debt Calculator ) FAQ
Hews khedia.i Contact Usf.Home
Bdstlng Qients Home Parle
Privacy Statement
'.:copyright©Amerldebt,Inc.
htty Jhevw~ridcbtorg/oarsarvicaahtml
IRS - EX -O002390
AD-LlT-002503
¹:1611
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uou-profit orgoaizatfoe
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~u 'Ne Are
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Fill ont ~ ei s yfarm end
an Arnerlbnbt counselor will contact you
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Counselors Standing Sy NOW
Ftee%ualuut!on In 1S Iil!nutes or less!
:IS® Facts
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If Bigs Past Dus, For How long? — Select One
Select On» — ~ «
WoprNou!dYou Rats Your Cmdlt?
Do You Own Or Rent? — Select One — ~ «
Is Your Igortgage Current Or Fast Due? — S agestOne
Best Time To Contact Youp . S e lect One

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Cllclr any boxes below' that describe your deb@
Credit Cetds
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Past Due III!Ilty SNs I
Per s onal Loses I
lied!eel BIgs
httpllwww.ameridebl org/applyoulme.btml
1RS - EX - 000239l
Ao-LIT-0025G4
¹:1612
IRS Texas
I
Stud ent Loans
Submit
P'
I onlg ~ s ubs4l IH4ee ence)
Due to the large nuriber of applIcants you may be ..
referred tn another 501C Non-Profit or Debt
Coneolidatlod
organization. This wilt allow us to provide you with the
' M st service and options evadable.
p~
NOTE - Am erlDebt only worlcs.with debt payable In
UD. currency
II
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Who We Are I Our Services f Apply Online
Cmflt Report I Debt Facts I Debt Calculator I FAQ
News Media I Contact Us I Home
Privacy Statcnacnt
Copyright©Ameridebt, lne.
htlp Jhvww~c r i debt,orll/spplyottlscddmi
IRS - EX - 0002392
AD-LIT-002506
¹:1613
n on-proffl or ganizaI l oa
1
3-irl-1 ilerged Credit Report lnstatttly Online for $34.99
•
includes:
W Your complete creditproSe.
W Up to date informabon pnnrided by EEptsislr, .
Eqtihx, and Trans Union in IIO seconds.
W.Your credit rights under the FCRA.
W UnlinNed uee of our CmlltAdvtsoty Hotline.
+ To pay by AIIIIEX or Check please click here.
i
•
ttltetr)
r AE tretrerrrnsreerrwtts en (o) erorrert
-PERSONAL' INFORIIIIATION
lAST NANE
HIDDLB MANE
PIBST NAIEE e
E&AXL~
SEND Etl'
DAls Dp rnsrrn
ts Nein ( porrrele
/f
-CURRENT QAlUNG ADDRESS
sraEETADD~
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f Orers tntearPOBror
-PREVlGUSIIAILlN6 ADDRESS
sraEETADDEEEB Ipo sortsu nrrtv notesDvroy)
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please choose ~
EIP CODE
I:
-VERIFICATION }NFORNIATION
I'tAB wweroe b tor Toutperoonv tveocott. For rrrore~
vslBPNONE Nu|IBEn
socIALsscualTP Muplssn
cQspltrNsoc. EEc trutesstl"
trtr o oe r'as lrere.)
ssconotucr AccouNTNulr sea
in order to recehta your Ieprwt anfne, please enter the fuII
sccountnumber ofa home lnodgage. carloan,era
. Second credit card with s mitL of 10 tlyls, so we csn
verity your idendty. This account wN not be etna@ed and
wil be used for idenlty vertttcaiorloniy. Please do not Ist
the same account that y'ou useBtrpayment. A'MIDebit
cards wilh a Visa or Master Card bgo cannot be used as s
secondary account number.
llttps Jpvwpsmonihrastcoln/oniinclcpoIts/afpoxdcxtonn~ ' t pro d ~
cqp n t onliI~ S Q g itL
294/2003
1RS - EX - 0002393
AD-LlT-002506
¹:1614
if you do not have this please cÃckbere
-ADDITIONAL OPTIONS
'PAYIltENT 1NFQRWfATIOH. ';..

For identity venfication purposes, we can only accept Visa, MasterCard or DiscoverlNenis hr.ail
onfine delivery apfians ltyouwish topsy by AMEX qr Check pleaaa cfick here tonic Pleaairdo
not usaany ATMIDebit cardi eveniithiy have a MastsrCard orVisa logo tf you do, you wiR fhfi
authendcatlon and w8i not receive your report online. For Iden@y veNicifion pLirposss, we can only
accept Visa, Ms''wCard or SscoverfNovus for sll onfine dafivery options. '
0
Credit Card Type'
Ctsdlt Caid Nannber' Expiration Date'
please choose
ANNY maidens aM sslc hr hsx
-YOUR OFFERS FROID INOI4ITRUSTt
Each month Ilhonibust publishes fis award winning newsletter on ciadtt and debt kipics that aesct
your daily Ilfis. Pieviaus topics bichde piolscfing younelf ttain the Ihniat of siantfiy ~ how to
consofidateyour dib,pha many mare pesonsl fi
nance topics.Addiifonafiy, fhunfimeto fime,
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r
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Your rights under the Fair Credit Reporting Act.
CONTINUE
'(Hease'cfick only 'once lo avoid uiufifple charges.)
~ To view your report online your bioswsr must suppoit Qhgt '
aocjyptigtt lo ensure Ihe piotscScn of your personal Informa5on.
h~
« c~ c r S
/v r wvrmonitnist.cain/oxiRicrcports/afpoxderfbris-esp VPo
jRS - EX - 0002394
AD-LIT-00250?
¹:1615
«ou- profi< organtgarfon
~
•
I
•
Oebt Facts
jlhjjlllfe.Are
~S
e l v lces
AmerIDebt ls committed to leaching consuiners the skNIs
and iNormation necessary to gain control of thelrflnancas'
.
and preventfng future ocaumnces of debt. Our credlt
<CredirlLeport c ounselori can answer many debt and creNt misted
questions.CaN today to find out more about our' Debt
'A)ebt Facts
NanagementProgram and other services..
;lldxt ~
or
~PQ ':-.
.
Debt in America
pre-approved credit card offers
approved." credit card offers - even though you' re In debt,
ormaybe your cnuNt ratfng Is far flem perfect? It has been
the bend, as of late, fbr Credltom to oNer their cards to aN
consumers,espedaNy those who have had creditand debt
problems In the past. They hope that your past poor credit
habits wlN force you to spend more money with their card
and rack up plenty of interest and late chages. They' ll
earn money and you'N be back ln financial tunnoiL You' re
certainly not alone: The average American adult readved
32 credit card offers, regardlessoFtheh nadlt history
Average fam)ly credit card debt
You might
be wondering, "I owe my credNorsthousandsof
dollars - there can't be anyone worse olf than mel You' re
. pot alone) Amerloebt's dlents carry balances as high as
": +CO,OQO.
Personal bankruptcy
One indicator ef debt ln the U.S. Is the number of pe+anal
.bankruptciesdedared each year. WhNe many unwed .
bankruptcies are declared than need to. be, stathtlcs show
how many people feel their debt burden. is mare than they
can handle: personal bankruptdes are at an aN time hlghl
In 1997 there were more than L3 mNIion dadared. That
figure is up 63%'from )ust 10 yean ago.
National consumer debt
In many ways, America is a nation weighed down by its
cIUzens'(and government's) debt, National consumer debt
reflects many dNferent factors, so we'N concentrate on
consumer credit debt, which accounts for 40% of the
national figure.
National consumer debt has reached an aN-thne high of
over 1 trigion doQars. Credit card debt accounts for
bttp:/twww~ eridebtoxg/debtSeislrlml
2/14i2003
IRS - EX - 0002395
AO-! IT-002508
¹:1616
approximately 400 bflllon dollals of that figure
'
"
You can hel p stop our natonal romance with debt by
becoming debt free, learning the sklgs necessary to
.manage yourown llnanCd'san/ handling your.'spending
:.responsibly. let AmerlDe4K help you.become debt free,' .
and along the way, we can show yoo how to.be a
responsible aedlt consumer.
AmerlDebt Is currently developing comrnunky e'duca5on
seminars,a creditcounseli
ng GD-RON, and a number of
othereducational resources for ourclients and the
community at large.
III
' II
I I
Who Ne Are } Our Services l Apply Online
Credit Report l Debt Facts } Debt Calculator } FAQ
News Media l Contact Us l -Home
Privacy Statement
CopyrlgbteAmarMebt, Inc.
http Jfwww ~eridebtorgldeMaots.bhnl
1RS - EX - 0002396
AD-UT-002509
¹:1617
llli% RSK
hen-pfoffl otghh jxoflon
4m.
'"i+lib ®e Are
gP Debt Calcolatar .
.5s;Se ntices
"Apply Online
Cgj4lt Report
Hoer long will R take'you 4o pay~ff your bills' ?
Answer lhaques5one and Ind ootl
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ounmponenmpenammunmyoupeyinpy
inpmamyourmmepryrppum
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Who Ne Are i Our Services l Apply Ongne
Credit Repo* l Debt Facts l Debt Calculator ) FAg
News Nedla'l Contact Os ) Home
ExlsUnjQtents Home Page
Jn,
Privacy Statement
Copyright©Amerldebt, Xnc.
hltpitwwvr~ d e btorg/dobtcsIc.o5a
IRS - EX - 0002397
AD-LlT-002510
¹:1618
Ni% BBa.
s pa- pro jis orgonizoi fo>!
I,
~ FAQ
'Qergervices
'Why can't I Just negotiate with creditors on my own?
Why can't I just keep paying aif my creditors on my own?
How muchwHi lt cost me to be' on the Debt Hansgement
Program?
.
"Apluy'OSNae
' Crylit Nesort
Howwill joiningAmeriDebt's Program affect my credit
rating?
Can.I send in more money once I have a better cashfio'w?
..Dept acti
Should I pay my bills ln the time before I send you my first
payment?
VAQ
After I pay off one account, can I Just pay less?
Will I still receive harassing phone catis2
Nuvs INSdis
: CoatactW
Q: Nhy can't X just negotiate with creditors on my
:Q,Name,
ownV
A: In some. cases, you can nego5aae with creditors on
yourown to amnge payment or have poswve Information
reported to a credit bureau. However, to gea the benefits
of lowered monthly payments, lower interest rates,
stopped late charges, and waived over the Nmit fees, ym
need AmerlDebt. As a non-profit organlsatfon, AmeriDebt'
~V
kh o 5baew credit counselors can secure you these beneQs not usually
.erin
i l lÃ
available to credit consumers.
Q: gushy can't X just keep paylnl ol my credltom on
my own3
A-Lf you keep paying just he minimum to jour creditors
at the current interest rate, lt will take you much longer

-than~
pa i d-off your' debt through AmerfDebt. A
$1O,OOOdebt usually takes.32 years and 424,glO to pay
off, lf you are paying. the monthly mlnNnum of 2.5%'of.the
balance stan average Interest rate of 18.5%. Because we
may be able to reduce your Intent retie, stop overthe.
omit fees, and so, on, it will take a'lot less thae to pay off
your debt through us. Chances are, In the past, ali your
debt payments have just gone lo pey off interest. You
probably haven't even reduced the baiancelOn average,
AmeriDebt dlents pay oif their debts ln 3 tu 5 years,
depending on individual circumstances.
Q: Hour much will It cost me to be oa the Debt
Management Program2
A: Due to the fact that AmerlDebt is a non-fsof}t
organfzatlon, we do not charge eny advance feesfor our
service. We do request that dientsmake a Nnonthly
contribution to our organlsatlon to cover the costs involved
ILttpJ/www~d e b toqf/%qhtmI
2I142003
IRS - EX - 0002398
AD-LIT-002611
¹:1619
tn handling the accounts on a monthly basis. As a non
profit organfzaffon, Arnertoebt depends an these small
mntrlbutlons to meet our operating costs. Our dtents find
that their increased cash flow fiam lower monthty
- payments, interest rate reducttonsend stopped tate' ..
chaiges more than'Covers the coSt ot the monthly '
contribution.
h
g: jhow willjoining Amerinebt's Program affect my
credit rating?.
A'1: Doyou have a good credithistory? IfyeS,then you
should be aware that your credit report may state that you
are working through Amertoebt. We can't guarantee how
future creditors wtl interpret this tnforrriatfon, butte
befieve that it shows you are tfytnq tjo get help. Your clefit
report probably slates that yothre been carrying balances,
made fate' paymehts ln th'e past 7 years, or even missed
payments, so lt may not be as perfect a credit history as
you think.
A2: Ef no, then AmertOebt can only help you.If you make
your paymenfs tn full and on time to Afna~ t
hen
. many of your creditors will "re~ " y our accountI which
means they wttf show your accountsas currant after
several payments. Showing that you are worfdng thmugh a
credit counseling servke may show future creditors that
you needed help but wanted to payoff your debts fn fbL
Q: Can Isend in more money once I haves better
cash flow?
A: Of course - you can always'increase your monthly
payment.The more you pay'
,the fasteryour accounts wgf
bC paid off. 3ust let Ameitbebt know you want to Increase
your payinents befbrehand so we can figure out whlclr
creditors to pay mora money.
.
Q: Should I payIny.bills in the time before I send
you my first payment?
A: That'syour decfslon,how ever we recommend thatyou
do lf you can; There isa brief negotiation period of
appmxtmatety 3Q days after we receive your ff|st
Amerioebt payment. During this time we make.
arrangements for fubse payments with creditors.If you
miss due dates for accounts during the negotiation. period,
' you are at risk of penalties and negative information
reported to the credit bureau.
Q: After I pay off one account, can I just pay less?
A: The& your decision, but we highly recommend that
you pay the'same amountand transfer whatever you used
to pay for the othe' account R a high Interest account.
That way,as you pay offeach account,you end up paying
more to the remaining accounts, speeding up the proaes
without changing your monthly spending budget.
iutp Jhwnv.amexidebt.orft/faq Jxtmi
2/14/2003
1RS - EX - 0002399
AO-UT-002512
¹:1620
Ql Will I sOll receive harassing phone caHa7
A: You might the first several months on the program
since lt takes Ume for your creditor's collections
department to find out you' re with AmerfDebt, lf you get a
'harassing call, inform the party. to calf ArnsrlDebt ancf;
- speik to.your account speclafist., IF you get a harassing call
from a coffecOon agency that fs not part of y'our.'creditor's
company, we wnl provide yoli with a cease end desist
letter. 3rd party coiecUon agents must obey this letter,
according to the Fair Debt Collection Practices Act. Nake
sure you tei your account specialist ff you receive any
. such caffe horne collection agent.
' .I :
4l »
Vtho We Are l Our Services t Apply Online
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. Copyright©Ameridebt, Inc.
http Jtwww~cridcbt.ozgffaq3sbnl
2/l4Q003
1RS - BX - 0002400
AD-LIT-002513
¹:1621
H}i% s:K
boa-pcoJf! orjauii a rloo
I
'Waome Are
Survey Debt — NOT Terrorism.-
No. 1. Reasonfor Ame
ricans.
Cutting Summer Vacations
Dent facts .
' • To hear tbe 6/26 ldenews event briefing, click here.'
• To see the detailed survey results, cikk hete.
FAQ
«tact le
~ News Media
•
•
•
CONTACT:
Comps~
vgep Qiaaa
. Wal
• For more Information, conlect Christine Kraly,
703/276-325B,or ckraly@ hastingsgroup.corn.
MENS RELEASES:
~ AmerlDebt Urges Support for Bush Plan to Encourage
-INIder Nlnority Homeownershlp
. KEY FACTS ABOUT AÃERIDKBT:
• AmerIDebt Is the friend of consumers In crisis. Ne are
one of the - If not the - hstestgrowlng credit counseling
organttatlons In America.Ne have a 99.75 percent
satisfaction rata based oh lhe ratio of compfalnts to
current.' consumer cIIenb. Ne've worked with 280,000
consumersto date and have 82,000 current consuner
dlents. (11/30/01 date)
• Amerloebt has a "zero tolerance" poIIcy when It comes
to consumer complaints. Ne resolve all outstanding
complaints In favor of the consumer cIIent. We have put
In piece an In-house counsel who handles all complaints.
-http Jfwww~
deb t o qyhewahtml
IRS - EX - 0002401
AD-LIT-002514
C ase 8:07-cv-01476-CJC -AN Document 70-3 F II de 06/18/08 Page 50 of 72 Page ID
¹:1622
We have instituted what we beBeve is the indu~
best consumer educaUon progrun to inform corsumers
about debt and budgeting,
'
.
'
,. • AmeriDabt is relnventing consumercrqditQunsellng. • . -.:.„
Yve provida far more exbeslve c'oosuines.sajvtce thiN
nfost small "mom' and pop' cr'edit
organizations couN ever hope to do. yye are challeiigtqg
and going beyond our competitors' outdated 1972-style
pryctices to make credit counseling more 'consumer
friendly"and in tune vnth 2002. We don'tjuststop wi
sth".
coun
seling
credit cards - as many smaller credit counseling it'
. do. AmeriDebt also helps consumers with other debts,
such as crippling medical bias. As y result, we hnn away
eling
fewer consumers than other credit couns
organizations do.
. • Ne advertise because we know that's the only way to
reach many people who don't read or are not already
plugged into other groups that do referrals to credit
counseling orgsnhatlons.
WhoWe Are I Our Services t Apply Online
Credit Report j Debt Facts I Debt Calculator ) FAQ
News Red'la ) Contact Us I Home
Existin
g CIenis Home Page
Privacy Statement
Copyright©Amerldebt, inc.
http Jtwww~
deb t o rg/newsktml
IRS - EX - 0002402
AD-LIT-902615
¹:1623
FB Zs-sl l3 :03
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T Z4Q P.33/D8 F"lE4
-I
ononfat crecN
co lmlirg eganhallon
12150 MlddlebrClok Rd., 4th Raor
Qsrmarltown, MO 20874
This agreenent is uuulc by and between AmcriDebt, Inc a Macylend non-profn coiparation (hereinaficr referred to as
"AmcriOcbt") aod the below signed cHem (hereinafter referred to as "Client", "l", "Me", "Mysel~ I engage the
professional services of AmeriDebt to provide debt management and counseling services in negothitmg a repayment plan
wirhanycrcdimrs. I hereby authori2a AmeriDebt to negotiate a repaymentplan with my credimrs. I am responsible for
providing AmcriDebt whh accurate information about all of my creditors andsourcesof income.
ln caasideradoci of, acid bL furchercuice of the services co bc provided by AmcciDcbt, I hereby mahorlze AmcriDebt to: (33
disclose any information concerning my financial condition aadstatus, inchiding but not lhnited to income, debts, credits,
earnings, and/or locathm information to aay creditor listed by mc aud (2) obtainwhatever financial infonnatiaci
canceining rnc&am any creditor, as AmeriDebt deems necessary.
l agree to deposit with AuicriDcbt, by the dateo eyeed upon with my counselor, the, fal stnaunt af money needed to cover
all of my monthly debt paymenta unda' the repayment plan negotiated by AineriDebt. I shall make sll of my momhly
deposhs by beak checic,certified check or money order madepayable ta "AmcriDcbc . I undcrsumdthat I cannot make
my paymeat with a personal check.
I cmderstand that AmeriDebt will attempt to bring my accoumscurieiit, but that AineriDcbt makes no claims to improve
or remove any credit reference on any client's credit repan. I recognae that AmeriDebt has no rcsponsibiTity ar
.obligation for any psst, present or future credit rating assigned to me by aciy of my creditors or for any information
comaincd in any credit reporting service file.
l understand that AmcriDebt wiH negotiate with my creditors in en snempt to seduce my required minimum montMy
payments. I also understand that this ncgotiarion process bcip'ns when I make niy first payment and takes between 20-30
days to complete. I understand that my creditors may uoi receive aiiy payments from AmcriDcbt until the negotiation
process has been completed. I further understand and have been advised that if possible, I should make interim paymccits
term@ creditors during thewegotiatian period and that due m the negotiation period, 1 may initially fall behind on my bills.
It has been citplaincd ta me that my crcdimrs can sndmay freeze or close my credit lines while I am enrolled in the debt
management program. l uudezscand that the reescablishmcut of my credit lines is at the discretion of my credhora
l understand that AmeriDebt mayrefer me to outside lending sources in au «ncmpt to secure finsncing. This will be done
solely at my discretion. Any financial transactions betweenany leading sourcesand I are strictly between myself aad
those institutions. If, however, I do pre-pay the amount of myconsolidated debtthroughborrowed fi ends or in someother
manner, I understand that AmcriDebt may receive an additional voluntary canmbution fmn my crcchtors, sud I Nrcharhc
AmeriDebt to accept that contribution.
l ftecly volunteer ta abide by the terms of this Agrcemcnt. AmeriDcbt may mahc changes in this Agreemcnt by giving
me 30 days nonce and an opportunity to reject those changesby wrmcn notice ta AmcriDebt during the norlce period.
Any changes nat injected during thc notice period will become effective an the date spccified in the notice. AmcciDcbt
agrees ta negotiate with my creditors and scud me stetcmcmts of paymecits which have been made duough AmeriDcbt
upon my request.
F B-t$-01 l s:01
¹:1625
Ft O S.
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AmsriDebr agrees that all information in my file will be otherwise kept confidential and used only for legitimate twsiacss
purleses under the Fair Credit Rcpmting Act.
i understand that this Agreemem can bc terminated iinmcdiatcly by AmeriDebt if ir is found that I have provided false
infoanation to AmeriDebt or if thc terms of this Agreement ate not strictly complied with. I can also terminate this
Agreement for any reason by providing written notice to AmeriDebt. l expressly agree to permit AmeriDebt to deposit
my paymenrs with other funds being handled by AmcriDcbL
l undcrsmnd thar AmcriDcbt does not charge «ny required "advanced fees" for any af their progratns, but l underst«ud
that l have bccn requested «nd voluntarily agree to make a cme tine none«fundable "counseling" contribmian to
Ameri Debt equivalent m 3 l4i of the toml debt that they are handbag for mc. This connibutioa is approximately equal to
- one of my payments onthe debt management programand will be procuredflam my f irst paymem. l understand thu thc
- counseling" contributioa will be used to cover the operational costs involved m scaing up niy account and negotiating
with my creditors. l further understand that in addition to the one time "counseling" contribution, 1 have also been
rcqucsrcdand agree to make a voluntary "monthly" contribution of $7.00 pcr sccatmrthat AmeriDebt is handling for me.
l also understand that the minimum account contributioa to enroll!n the pmgram is Q0.00. These funds will bc used to
cover the costs involved in handling my creditors on a monthly basis. l authorhe AmetiDebt m deduct this camribution
from thc momhly dcposis that l make. l understand that AmeriDebt will collect the "manthly". contribution every month
that l am on tbe debt management program. 1 uaderstand that all requested contributions are voluntary and that
AmcriDcbt will assist mc regardless of whether or not l agree m contribute. 1 also understand that some creditors will
niaks voluntary financial contributions co AmeeiDebt based upon payments made by /4n~Dcbt on my bcha}f, «nd l
authorise AmsriDebt to accept such conmbuoons.
i hereby agree to hold AmeriD«bt, its employees, of%cars, die«cmrs «nd «gems harmless from any chum, suit, action, or
demand made by any of my creditors, any lending institutions to which AmeriDeht may refer me, or any other entity or
person, which in any manner may arise from any action or inaction taken by any entity ar person, in connection with any
services rend«reel by AmeriDebt for me, including any claim, suit, action or demand which may «risc out of the
negligcncc of AmcriDebt, its employees, officers, directors or agems.
AlneriDebt and l agree to ail of the terms and conditions of this Agreement and each of us has received a copy. There are
no other «grecments, promises, or representations, unlcsa executed ia writing between AmeriDebt and mc, other than
those contained in this Agre«ment. This Agre«mam shall bc considered for all pmposcs, including interpretation, court
iyhmd.
jurisdiction, aad consumer rights, as a contract made wholly in the State of Ma
Please prim below and sign:
REDACTED
Name:
SSN:
Spouse/Co Appi
Address:
ae:
REDACTED
Work Phaneut~
Home Phoner:(
Nother's Maiden Na
C am
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' [For sssarlty r+epoeesQiny+KDACTKD
Sate
Si g nature
ress:
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$ S«L.
l x Spouse/Co-Apple«at Signature
Email Addresst
COrei
Aut ariaed Corporate Signature
Jannie Houle
Please indi«amwhen you win be
able ta
send year first paymentt
IEST l7NE 4pCACE yO EEhCH YO r/4
eel plage /psoeep!
e.c. i~
~ as
¹:1626
¹:1627
OS/1TISB 1T14$ FhX,SIS'42372TT
I
khERIDEBT
C
0004/OOT
L
mon
a non-Profit credt counseling ofganlzci
775 Park Ave., Suite 120
Huotlngton, NY 11743
This agreement is made by snd between AmeriDebt, Inc„a Maryland uan-profi corporation i]lereina
to as "AmrrcjDcbP) and thc below signed client gereinafher'xejerrcd to as" Cljsxlt", "X, 'Mc, ~ s cl~ ,
engage the professional services of AmeriDebt tn provide debt msnagcruerrt end cauilsclixlg services ln
aegotiating e. rcplg%lcnt plan wlthmy cree Hrols. I hereby a!I51oriae AxueriDebt to xlegotjate a zcpaymcnt plan wjr]L
my creditors. I am zeapanslble fax' providing AulezjDcbt wit]L accurate 1ufazmafion about aQ of uxy cxedltarS and
sources of income.
In consideration af; and in fuztllersnce Of thc services to be provided by AmcliDebt, I hereby axlthozise
AmerjK)ebt tol (1) disclose any irdaxznctian concerning nzy financia candition and starns, inchlding but nct
limited tc income, debts, credits, earnings, and/ar location in&nasticn to any creditor listed by me and Q) obtxLm
whatever fmanciai irlfaaaatian concerniug me jzom sny creditor, ss AmeriDcbt deemneceasazy.
.I understand thLtAmmDebt doesnatcharge sny "advancedScs" Re'«ag ofthirprograms, butIunderstandthat
I wi]1 be requested to tusks amontMy contrjbutian tn AmerjDcbt of 33.00 - $6.00 pcr account that AmeriDebt is
handling far me. These ibnds wjll be used to cover thc costs involved in handling my creditors on a maxrjhly
I authorise AxneriDebt to deduct this caafzibutian izanl thc dcpasits thLt I make. I understand that
AmcrLDcbt will co]]cat ibis cantributicn every manth that I am an ]he debt management program. I «isa
understand that some creditors wiQ make vohultaxy imaxlcial contzibuticns tc AmeriDcbt based upon payments
made by AmeziDebt an my beha]f; snd I authorise AxneziDebt to accept such contributions.
I agree to deposit with AzluuiDebt, by tbe dates agreed upon with my colmse]or, 8m fall smaunt o f money zlcedcd
to cover aQ of my xnonthiy debt paymenta Luldar<e zepaymcutplsnnceotiatel by Ame'riDebt. I shall make all of
zny xncnth]y deposits by ban]z chcc]c, certifi e check ar mancy order made payaMC to "AmeriDebt". I Luldexstaxld
that I can.not make my payment with a personal chec]r.
I understand that AxncrjDcbt will attempt to bring my accounts clnzcnt, bnt,thlz AxncrjDebt lna]ces n
lrQpfove oL' Xclnove. any Credxt reference on sny client S credit zepart, I recognise thlt AmeriQebt hsa no
reapoLLslbi]lty or obhgatmn iar auy Q~ pfcscnt oz Stuxe credit rating assigned to xoe by my of my creditors
. far auy jnfarmatioo pontaincdin any credit zepoztulg service flle.
I understand that AmerrDcbt wj]l negotiate with my creditors in sn attempt to zednce my repired minim
monthly paymenta I a]so undcfs5Uld thsz this ncgatastln prOCCSS
ta]ces between QQ-3Q days to complete slid thlt
my creditors wi]1 not zecc&e any psyalccts Mm AxllcQDebt unti] thcnegotiation process haa baaLL eocnp]etad
I understaxld that AmeriDcbt may refer me to outside lending sources jn an attempt to secure flnanculg. This wi]1
be done sa1cly at my discretion. Any flnaucial trmsactions betatom any lending Sources and I sze strict]y
b~ ~
~ ~ If m t h ose ~bnm~ . I f, h~
. I d o pze-pay the aznaunt af my aceso]j~ d , bt tlggggh
borrowed.flxnda ol' ill saulc Other Tllauucr, I undcrsuLud that AxucriDcbt ruay, receive sn adit|tonal
ccnrtribiiltion fhml my creditors, and I authorise AxncriDebt to accept that ccntxibuti
¹:1628
os/17/s s
1 7 - .50 Fax $184257277
hNRXDEBT
QOO5/OO7
reem
nte
by
I ireely vo]uateer to abide by the terms of this Agre~
Ame ri Debt may znalae changes in tbia Ag
oebt'during the
ging znc $0 days. notice and. an opportunity to reject those changes by writtennotice to Aznsri
notice period. Any changes not rejected during the notice period will became e8ective an thc date spcci5cd in
~nezg)ebt agrees ta negatiate witiL my creditors aud send me statements of paymeats which have
Amcripcbt upon my rectuesr.
I tzadcrstand Q~t this Agreemenz can be terz~
mz m ediately by AzrssriDebt if zt is found thar I have pravidcd
Slse mfarznaticm to AmcriDcbt or if the terms of this Aipecmcut. are not stCcQy complied with, I can also
tetminate this Agreement for sny zcaszsz by, pro%ding written notice to Amcrioebt. I expressly agree W permit
Amcd Debt to deposit my payments with other Sade be'manhandled by AmcriDcbt.
I hereby agree to-boM Aznerioebt, its employees, oscars, dhsctors and agents hnznlcss Sum any claim, suit,
msy retbr zne, or
action, ar demand made by any of my areditars, any lendmg institutions to wgch hnzcr'oebt
i
any other entity or person, which in any' znsnucr maysriseizom auy iction or iinactiou taken by any entity or
pcuon; iu connection with any serrices rendered by Amer97ebt fcr me, afEcers,
inchcHngdirectors
any claizn,
surd actiorz oz
or agents,
deans'which znay arise out of the negligence af AzncriDabt, its
empyloees,
Amerzoebt agrees that all hfozrnatiozt m my f0e wlQ bc othcrwisc kept confidential snd used only for legitnnate
business purposes under the Pair Credit Reporting Act.
Azncriocbt and I agree tc all of the tcrzns snd conditions of this Agrcemaozand each of us has received a copy.
There are no o'er agreemcnts, Premises, or zeprescnMans, unless executed in writhg betEvem AzrLsriDcbt and
rn, other than those.contained in this Agreenzent. 'Ibis Agreement shall be considered for all purposes, includmg
interpretation, court jurisdiction, and consumer rights, as a contract made wholly lnthe State of Mszyhnd.
Please print below and sign: .
~ltd ~
REDACTED
Spcnse/Co-Appr
Address:
RKDACTKD
Some Phon&
RKDACTKD
Castozner Qgnature
AuthorisedCorporate Signature
Bob Thomas
Spouse/Co-AppmcaatSignature
¹:1629
¹:1630
AGREEMENT
This agreement is made by and between The Credit Network, Inc., a Maryland non-profit corporation (hereinaffer referred
to a s "Ihe Credit Network" ) and the below signed chest (hereinaffer refexred,to as "Client", "I", "Me", "Myself). I
engage the professional services of The Credit Network to pmvide debt mauagementand counseling services in negotiating
a repayment plan with my creditors. I hereby authorize The Credit Network to negotiate a xepayment plan with my
creditors. I am responsible for providing The Credit Network with accurate iufoxxnstion about all of my creditors aud
sources 0
In consideration of, and in furtherance of the services to be provided by The Credit Network, I hereby authorize The Credit
Network to: (I) disclose any information conceraing my financia condition snd status, including but not limitoi to
mcome, debts, cxedits, earnings, and/or location information to any creditor listed by me and (2) obtain whatever financial
information concerning me &m any creditor, as The Credit Network deemsnecessary.
I ayee to deposit with The Credit Network, by the dates agreed upon with my counselor, the full amount of money needed
to cover all of my monthly debt payments under the repayment plan negotiated by The Cxedit Network I shall make all of
my monthly deposits by bank check, carded check or money order made payable to "The Cxedit Network". I understand
thatIcau notmake my payment with a personalcheck.
I understand that The Credit Network wiU attempt to bring my accounts current, but that 'Ihe Cxedit Network makes no
claims to improve or remove any credit reference on any client's credit reporL I recognize that 'Ihe Credit Network has no
responsibility or obligation for any past, present or futuxe credit rating assigned to me by auy of my creditors or for sny
information contsiaed in any credit reporting service file.
I understand that The Credit Network will negotiate with my creditors in an attemIC to reduce my required minimum
monthly payments. I also understand that this negotiation process begins when I make my first payment and takes between
20-30 days to conxplete. I understand that my creditors may not receive any payxnents&om The Credit Network until Se
negotiation process has been complete. I Sxrther understand and have been advisedthat if possible, I should make interim
paymeuts to my creditors during the negotiation period and that due to the negotiation period, I may initially faH behind on
— my biHs; It has been-explained to me that my creditors can and may fiuezeor dose my credit lines whBe I am enxoHed in
the debt management prograxn. I understand that the reestablishment of my credit hnes is at the discretion of my creditors.
I understand that The Credit Network may refer me to extside lending sources iu anattempt to secure financing. This will
be done solely at my discretion. Any financia trausac6ons between any leudmg sources and I are strictly between myself
and those institutions. If, however,? do pre-pay the amount of my consolidated debt through borrowed funds or in some
other manner, I understand that 1he Credit Network may receive sn additional voluntary contribution Som my creditors,
and I «uthorize The Credit Network to accept that contribution.
I &eely vo~
to a b ide by the terms of this Agreement. The Credit Network may make changes in this. Agreement by
giving mo 30 days notice and an opporhmity to reject those changes by written notice toThe Credit Network during the
notice period. Any changesnot rejected during the notice period will become effective on the date specified in the notice.
The Credit Network agrees to negotiate with my creditors aud send me statements of paymeuts which have been made
through The Credit Network upon my request
The Credit Network agrees that all information in my file will be otherwise kept confideudal snd used only for legitimate
business purposes under the Pair Credit Reporting Act
I understand that this Agreement can oe texxuiaatcd im4e4@QQ by The Credit Network if it is found that I have provided
falso infoxmation to The Credit Network or if the terms of this Agreement arc not strictly compHed with. I caa also
terminate this Agreement for any reason by providing written aotico to The Credit Network. I expressly agree to permit
The Credit Network to deposit my payments with. other funds being handled by The Credit Network
I understand that The Credit Network does not charge any required "advanced fees" for any of their programs, but I
uaderstaad that I have been requested and voluntarily agree to make a one time non-refundable "counseling" contributioa
to The Credit Network. This contribution is appxmxuaately equal to ono of my payments oa the debt management program
and wiH be procured fi'om my erst payment I understand that the "counseliag" contribution will be used to cover the
operational cost iavolved in settiag up my accounts and negotiating with my creditors. I further understand that in additioa
to the. ono time "counseling" contribution, I have also been requested aad agree to make a voluntary "mouthly"
contribution of $6.00 per account that The Credit Network is hmdling for me or a total sum of $25.00 monthly, whichever
asls~ authorizo
The Credit Network to deduct this contributio Sm the moathly deposits that I make. I understand that Thc Credit
Network wi11 coHect the ".monthly" contribution every month that I am on thc debt management program. I uaderstaad
that aH requested contributions are vohntary and that The Credit Network will assist me regardless of whether or not I
agree to contribute. I also understand that some creditors wiH make voluntary fiuaucial contnbutions to The Credit
Network based upon payxaents made by The Credit Network on my behalf, and authorize The Credit Network to accept
such contributioas.
I horoby agree to hold The Credit Network, its employees, of6cers, directors and agents harmless fiom any claim, suit,
action, or demand made by any of my creditors, any lending institutions to which Thc Credit Network may xofor me, or
any other entity or person, which in any manner may axise fmm any action or inac6on uLken by any entity or person, in
connection with any services rendered by The Credit Network for mo, including any chmn, suit, action or demand which
may arise out of the negligenco of The Credit Nctwodr, its employees, of5coxs, directors or agents.
The CreditNetwork and I agreo to aH of the tens and conditions of this Agreement aad each ofus has recaved a copy.
There aro no other agreements, promises, or xopresentations, unless cxecutod iu writing between Tho Credit Network and
me, other than those contained in this Atpcement. 'Ihis Agxoomcat shaH be considered for aH puxposos, including
intexpxehaioa, court jurisdiction, and consumer rights, as a coatract made whoHy in the State of Muylaad.
Please priat below aad sign:
'hn
Name:
8
~~
REDACTED
e P h o :(
REDACTED
SS8:
Spouse/Co-Appt
Addrcssx
REDACTED
SQx
RKDACTEB
Work Phonek~~
Sta terCA Zip 9 $ l w 2
~
Custo er Signature
Spouse/Co-AppHcant gaaturo
Email Address
EmaH Add~
X
Authorised Corporate Sigaature
Lha Kramer
i
EEsr Tats*PLACE TO REACHYOU: BESTTME: CN CA%
~D A CTED
".MPORTANT»
Please indicate when you wjll be able to
scndyour Grstpaymcat:~' j
EEsTtxACEg HCNEHUMEE+
/ c6
/2
REDACTED
¹:1632
Visual Credit Application
Page 2 of11
¹:1633
letter by email please send the email to your counselor's attention in the subject as well as
your first and last name. If you fail to do so it is not guaranteed that he or she will be able to
receive this.
Sincerely,
Visual Credit
Visual Credit
336 E. Fort Lowell Rd., Suite 100
Tucson, AZ 85705
AGREEMENT
This agreement is made between Visual Credit Counseling, Inc., an Arizona non-profit
corporation {hereinafter referred to as "Visual" ) and the below signed client {hereinafter
referred to as "Client", "Me", "I", "Myself" ). I engage the professional services of Visual to
provide debt management and counseling services in negotiating a repayment plan with my
creditors. I hereby authorize Visual to negotiate a repayment plan with my creditors. I am
responsible for providing Visual with accurate information about all of my creditors and sources
of income.
In consideration of, and in furtherance of the services to be provided by Visual, I hereby
authorize Visual to: (1) disclose any information concerning my financial condition and status,
including but not limited to income, debts, credits, earnings, and/or location information to any
creditor listed by me and (2) obtain whatever financial information concerning me from any
creditor, as Visual deems necessary.
I agree to deposit with Visual, by the dates agreed upon with my counselor, the full amount of
money needed to cover all of my monthly debt payments under the repayment piannegotiated
by Visual. I shall make all of my monthly deposits by bank check, certified check or money
order made payable to "Visual Credit". I understand that I cannot make my payment with a
personal check.
I understand that Visual wiil attempt to bring my accounts current, but that Visual makes no
claims to improve or remove any credit reference on any client's credit report. I recognize that
Visual has no responsibility or obligation for any past, present or future rating assigned to me
by any of my creditors or for any information contained in any credit reporting service file.
I understand that Visual will negotiate with my creditors in an attempt to reduce my required
minimum monthly payments. I also understand that this negotiation process begins when I
return this signed agreement with any initial contribution I have agreed to make and take
between 20-30 days to complete. I understand that my creditors may not receive any
payments from Visual until the negotiation process has been completed. I further understand
and have been advised that if possible, I should make interim payments to my creditors during
the negotiation period and that due to the negotiation period, I may initially fall behind on my
bills. It has been explained to me that my creditors can and may freeze or close my credit lines
http: //www.visual-credit-counseling.org/contacts/
4/22/2002
Page 3 of 11
Visual Credit Apylication
¹:1634
while I am enrolled in the debt management program. I understand that the reestablishment of
my credit lines is at the discretion of my creditors.
I understand that Visual may refer me to outside lending sources in an attempt to secure
financing. This will be done solely at my discretion. Any financial transactions between any
lending sources and I are strictly between myself and those tending institutions. If, however, I
do pre-pay the amount of my consolidated debt through borrowed funds or in some other
manner, I understand that Visual may receive an additional voluntary contribution from my
creditors, and I authorize Visual to accept that contribution.
I freely volunteer to abide by the terms of this Agreement. Visuai may make changes in this
Agreement by giving me 30 days notice and an opportunity to reject those changes by written
notice to Visual during the notice period. Any changes not rejected during the notice period will
become effective on the date specified in the notice. Visual agrees to negotiate with my
creditors and send me statements of payments, which have been made through Visual upon
my request.
Visual agrees that all information in my file will be otherwise kept confidential and used only for
legitimate business purposes under the Fair Credit Reporting Act.
I understand that this Agreement can be terminated immediately by Visual if it is found that I
have provided false information to Visual or if the terms of this Agreement are not strictly
complied with. I can also terminate this Agreement for any reason by providing written notice to
Visual. I expressly agree to permit Visual to deposit my payments with other funds being
handled by Visual.
I understand that Visual does not charge any required "advanced fees" for any of their
programs, but I understand that I have been requested and agree to make a one-time non
refundable "counseling" contribution to Visual equivalent to 3% of the total debt that they are
handling for me. This suggested contribution is approximately equal to one of my payments on
the debt management program, which is procured from my initial payment. i understand that
the "counseling" contribution will be used to cover the operational costs involved on setting up
my account and negotiating with my creditors. I further understand that in addition to the one
time "counseling" contribution; I have also been requested to make a voluntary "monthly"
contribution of $6.00 per account that Visual is handling for me. These funds will be used to
cover the costs involved in handling my creditors on a monthly basis. Unless I have made
other arrangements with my counselor for a smaller contribution or no contribution at all, I
agree to the suggested "counseling" contribution and I authorize Visual to deduct the
suggested monthly contribution from the monthly deposits that I make. I understand that Visual
will collect the "monthly" contribution everymonth that I am on the debt management program.
I understand that all requested contributions are voluntary and that Visual will assist me
regardless of whether or not I agree to contribute. I also understand that some creditors wiil
make voluntary financial contributions to Visual based upon payments made by Visual on my
behalf, and I authorize Visual to accept such contributions.
I hereby agree to hold Visuai-, its employees, officers, directors and agents harmless from any
claim, suit, action or demand made by any of my creditors, any lending institutions to which
Visual may refer me, or any other entity or person, which in any manner may arise from any
action or inaction taken by any entity or person, in connection with any services rendered by
Visual for me, including any daim, suit, action or demand which may arise out of the
http: //www.visuaI-credit-counseling.org/contacts/
4/22/2002
Page 4 of 11
Visual Credit Application
REDAC>ED
¹:1635
negligence of Visual, its employees, officers, directors or agents.
Visual and I agree to alt of the terms and conditions of this Agreement and each of us has
received a copy. There are no other agreements, promises or representations, unless
executed in writing between Visual and me, other than those contained in this Agreement. This
Agreement shall be considered for all purposes, including interpretation, court jurisdiction, and
consumer rights, as a contract made wholly in the State of Arizona.
Counselor's Name: Matt Binder
Please print below and sign:
REDACTED
SS¹:
Name: Linda Rodgers
Spouse/Co-Applicant:
Address:
Apts:i
REDACTED
City: Sacramento ~
St a te: Caiifomia
.
. Zip.. 95828
Home Phone ¹: (
) 653-6820
Work Phone¹: ( 916
MOther'S Maiden arne (fOr SeCurity purpOSea Only): Brand
OP g
X
Customer Signature
Email Address
g~
Date Customer Signature
REDACTED
Date
gOV
Important
Please indicate when you will be able to send your first payment: 04/23/02
YVhen and where is the best time to reach youV work @ 10:OQam
Counselor's Name: Matt Binder
http: //www.visual-credit-counseling.os/contacts/
4/22/2002
¹:1636
Ca~8 ®7zy801f7~ J C -AQ Q@q~g„70-3
"0:1637
Filed 06/1 8/08 Pace 65 of 72 page ID
7%. 699
p. Z i4
O GHASE
Chase BankCard services, inc.
Bunny P,2A
JohnN Hatt
Vge phggdect
100 Nest Unlvegty Dm'e
Tetnpe, Moore 85281
June 30, 2000
RB: Chase's Pay for Performance godci of Support for QtntHt CounselingAgnes
Dear Counselor;
por some tirac noir Chase hasbeenreviewing its pohcies reNng to Credit Counseling. In our
review we have had professional "mystery shops" cornpictcd and we
have visited many different
agencies
(NFCC, AICCCA, no~listed agencies,agcncicsthatprovide face~&ac
counseling, and agencies thatprnnanly provide coumcling over 5ctelephone or thc intent).
We havefound greatdiQorenccs:
In organizationalstructnrcsanddelivery models,
In corneitmcnt to eQicicncy,
• In the quality and breadth of service that agencies are providing to oormgmcrs and crcrhtors
In the quality ofthc deoisions being made to book consumers on Debt Management plans
{DMPs), and
In the
perfonnance ofD MPs.
It is clear that different agencies require and deserve 4fkrcnt levais of support, To that end, we
are building a model by wMch wc will support non-profit credit aenscling agencies according
fo our eydualon of their status or performance against each of thc bullets listed above.
Ddive Models and RKeieu
Ahcadythisyear,Chase hasm adesome changesin our®r sbnc based ondclvcry models,
(Mgh eQioiency
Agencies ~ provide pritnatt5y telephone or intcssiet basol ceunscGng
dchvcry models) should rcqerc and Nllxeccive less fair sharc thanagencies winch also
maintain thc infiastmcture necessary to provide face~See oaescling to those consuracrscarbo
needorpreferthattypeofservice.Ifyouragencyisaffectedbythesechanges,youhavebeen
or will be notified under separate cover.
Also tMs year, Chasehas reduced fair share to agencies that do not emit payments
clcotronically. Futuro adjustments to Mr sharc wBl be made on the basis of wiethcr agencies
send proposals elcctrouical1y.
Case 8:07-cv-01476-CJC -AN Document 70-3 Filed06/18/08 Page 66 of 72 .Page ID
m. m.zeee e:z ~
~~~ sc e a czs rrg:.i638
~ -69 9
e .ar4
Clearly, rninhnurn standardsof quahty arcneededfor credit coursing snd debtmanagem
ent.
Chase will not conduct on~ reviews to evaluate the overall pity and intogrity of each of the
nahigher
over $00 agenciesthat arcsubm
itting DMP proposals tous. Rather, wc will maintai
fair share to agencies that demonstrate their wNingncss andability to meet certsin mimnmm
standards of quality aud integrity ttrrough accreditation by an independent entity. Many
af all sixes aud actuss the country, have already urken the initiativeto beaccrcdircd
through the Council on Accreditation for Children «nd Family Services (COA). %hQc this is not
necessarily the only independent accreStation that Chase will support, it is currently the only
agen
cies,
one wehave approved, Emotive September I, 2000, Chasewill reduce fair share by lS to all
agencies that have uot at least initiated a pracess for accreditation by a Chn~rpravcd
accrediting body..
Breadth of Service
ln addressing the wide ranCe
of consumer needs. effective agencies provide a variety of non
DMF rdated services, Yet m the current modal of support, which is based ~ y
o n f~ 5jgg+
agencies are supported only for establishing DMpa. ~jth curnmt nend ofd h .
agencrcs may be inclined to facus thercd'arts an providing atrly those services that ~~ g~~te
revenue fram creditors (LCi QM s) and to charge higher and higher ~ to consunters
Movementinthedirectionofthese inclinations wuuM narbegoadforthelong4ma hcalthof
credit counseling ar of our ecarromy. To counter thesepressures, beginning in 2001, Chase wiQ
divert a pool af money that would have bccu used far Nr shee into a grant program, Agencies
an appjicatian process, can proVe that they are provjding n wide range of non-QMP
that, th
related services to a siyu6cant panion af their community and chents will bc eligible for these
rough
grants, Maze information on this progrtun wio bcprovided in comingm onths.

QMP Ioakin Decisions
Many consur~ wha seek the assistance of credit counscljug agencies da not need a DMP.
Chase makes significant concessions and signfdcant Sir sharc contributions with the expectation
that we are doing so only for cousrnners who truly need e DMP. In 200l, Chase will adiust ihir
- sharc based-on-our-rating of the quality of the decisions your agency is making to book
consumers ontoDMPs. la order ta ~quate backing decisions, wcweal begin requiting, as of
October
2000,thatyou submit the Mowing infarnratlorr with all proposals;
Total Assets
Total l.iabilitics
Net Monthly brome (total of all income available for living erpenscs anddebt
• repayment)
Total Monthly Living Expenses(jncludmg payments on secured debt)
Total Unsecured Debt
Reason that the consumer is seeking the assistance of aOMP
• Paar Money Managcurent
•
Re duced Income
Medical
Divorce or Separatian
Death of Family Member
Othe
CaseJUL.28
8:07-gg14 Ilr@C -Ag DZZurynf
Filed 06/18/08 Page 67 of 72 Page ID
0h
%/I 9 ~ 70-3
63g
H O. 699
P. 4 x 4
~~
;t „ o f thc boohng decisions that your agency makes i'll be rated against the quality of
the decisions being made by a5 of the agagies sepdmg DMPs to Chase. Quality ratings vriH bc
rcvicvred at least annually andfair share vlill be ad3Qslodaccordingly. lf your agencjj does not
submit ~th proposals, the in forrnatloaneeded for oe analyars gnrmcatcd ® the bullets above),
th~ th poo~ quality rath' pal be assttencdforthepurposeofdeternnningSirshee.
9MP Performance
ln 2001, Chic vrjll evaluate theperformanceof DMPs. Oqrevaluation wi1(consider bov/Iwell
consurntms "stay on the plan" and "pay on the plan," and thereby reduceziskofloan loss. The
perfbrmance of the DMPs estab@had by your agency v41 be ratedagainst the pcrfoenance of
the QMPs established by all of the agencies sending DMPs to Chase. Perfonnaree ratings will
be reviewed at )cast annually and fair sharevill be adjusted accordingly.
I hope that it is obvious that Chase ismaking every effort to craft poMcs for supporthg credit
courtseling agencies which arc fair and balanced and ~ch vt% paxnote the long tenn health of
credit counseling and debt management in America. If you have any@uefions, pleaseferrite to
me at the address in the head of this letter, or call me at (480) 902~1.
Slnccrcly,
Pe& R! 8'set
3ohn %. Hart
Vice
President
¹:1640
casF1ctseofBsfzsK261ANPBQMNle7IOCS
-3FilHIQ358f P4ge%Ksff0~%age ID
AP1I, 212003 1Q'D5AM
tiO. 18e P. 2
¹:1641
CHASE
14lph barrett
OIINe CardasamberIarvtees
5N %Site i%ay Ce)|er ilnvo
hN'l'usa' Vice P&$4k%L
Newark, DS 19711
hyrG 1, 200$
Re: Pay for Performance
Pea I,any Ritter,
Chase is pleased to introduce its new Paybar Peformaee Program which towards high
performing credit counsehagailenciea (CCA's} with higher fair able rates. It is itnportant to
noteOat Chaseis not reducing ita top er sharerasa One of om main goals ia to reward those
agencies thataxeachieving the higheat levels of pedbrmance.
h developing our Pay for Perfonnance Program, we reviewed the recent per!bananceof Chase
oredit prolle of
approved CCA'L OvoraG per5arntanoe esameasured' by considering the
customera referredby CCA.'a to Chase,andttuar able to auecasa501y psrheipate in adebt
cnanalement plan. Agencies ~e rankad relative to eneazwdmrcn this measure. In eddincn,
5gther adjustrnenta were made if the credit counselingagency(h) does not process paymaute
electronically andlor p) is not ~
ted ,
Chateis proud io partaar with and provide ongoing support tu approved Credit Counseling
Agenciesthatpzende Debt Management Plans to approprile customers and eanhnue to aqqerj
thatnWmceeasfully cotnplete-the-program.%awiGcontinue to cantributcf fair sharete nca3
prost, SOI(cX3)~ g n ated agmciea that comply %th Chase tnunmum standards and tlat
maintain e mininuun level of performance within the criteria outlined abave. The following are
Chase's Minimum Standards Satwere conununicated to you, m previous correapondenccc
Agencies mustbelice+ed in aG states that squire 8censing and in which they have a
physicalpresence.
'
Agcunee must disclose
The speci&a amounts
to aH eanaumeraat least the following:
thealee fotmulaeusedto determnine the amounts) of ail ~
or voluntary contributi dies, thatarerequested&co theclients.
That entering intoaQMP mayhavi anerve hnpect on their credit bureaurapert.
Customersarerequired to close an e~ng credit Hnea(es',septthose needed for buenos
purposes).
Customers must avoid incLuring additional debt whge on the DhQ'.
That the agency ia supyortedin part by ccntributhms fhnn creditors.
CuaWnershave the ongoing respouaIRlhy to monitor der atatementa loci clreditors and
Sam the agencyendto report @screpatNnea
CasP IIC5be$$134aSX128'-AI%
AI'II. 21. 2003 10: 05AIIII
•
VI065-3
FilHkhARBS Pge% fSE@aae ID
No.7a4 I. 9'
¹:1642
hganeteamust obtain &cln aQ conaumerI a signed aukoriaatton for tba release of
their non pttNo (nformationby tbaagencyto their craditors and by their creditors to
thoagency.
Agenmes must havean independent audit or ravieer oonductad annually of all
accounta(ospecia}4r opeN'thy accounts and chant daposh accounts).
Relative to these mcastueaents, efkotive May i, BDOQ your Chare-aalgnedSir sharorate for al]
enrolled acooMnta ia4,50c/o. pleaseupdate your records to etlure 5111 ooutpBanca with the tlw
over thcucxtyea
Air shate rate. Chase will tnottitcr pertottnsnca Wtprteenents andeclines
d
through data capture and pe8ottnanoaanalysis.At this tune, pro plan tota-assignSir sharegaea
ia appeeitnatelytwelve tnontha.
As adisolaitnor, Chaao reserves 8N right to changeany fair share rata at any titnK The
gaodol for assignittg &fr share to creSt counselingagcnoieai • based upon Motsnanan
that la propgiatluyto Chase.
Wa look,kneard to ccn5nnhl to partner with yon to provide debt maegantentservices
to our aNgiblo oMcenars and'hope that you Snd our newPay for Performance Program
tnora actutitable. 1f you bavawy quedotN, please oaHtne at |',3N) 75$-l l e or aeail tna
esralph jcrrell ®fp~chmracora
Ralph Jatrall, AVP
¹:1643
¹:1644
" "(I
Chrrse Nanhsttao Rank USA, 5'..4.
l 00 5'hite Clay Center Drii e
2'" Floor
'newark. DE l97I l
l4lph ,4 rr ell
tarn ~ t e I'1~~tden
September 28, 2001
Cambridge Credit Counseling Corporation
67 Hunt Street
Agawam, MA 01001
RE: Periodic Review
Dear Counselor:
Chase has developed minimum standards for credit counseling agencies. Our policy is to review agencies
periodically to ensure that they still meet these minimum standards. In order for us to complete our review of your
agency, please submit the following materials by October 31, 2001.
I. An updated CC Agency Information Form (enclosed).
2. A copy of your IRS Letter of Deterntination confirming your status as a 501(c)(3) organization.
3. A copy of your license from those states which require licensing and in which you have a physical presence.
4. A copy of your written disclosures to consumers. Please highlight those sections of the disclosure in which
advise consumers:
About your fee structute (including both set up fees and monthly maintenance fees),
About the potential impact on their credit report if they go onto a debt management plan,
To close all existing credit lines (except those required for business purposes),
To avoid incurring additional debt while they are on a debt management plan,
That creditors support your agency through Fair Share, and
That it is their ongoing responsibility to monitor their statements from creditors and from your agency and
to report discrepancies.
5. A copy of the agreement, which you require to be signed by all clients, authorizing your agency to share their
non-public information wtth their creditors aud their creditors to share their non-public information with your
agency.
6. As evidence of an annual audit or review of all accounts (especially operating accounts and client deposit
accounts), a copy of the findings or the management letter accompanying the most recent audit or review.
Send this information to:
Alicia Shepherd
Chase BankCard Services, Inc.
4915 Independence Parkway, FS1-4
Tatnpa, Florida 33634