Type Private Headquarters San Mateo | Website FreedomDebtRelief.com Founded 2002 | |
Industry Financial Services, Debt Resolution Key people Brad Stroh and Andrew Housser, Co-Founders and CEOs Parent organization Freedom Financial Network, LLC Profiles | ||
The freedom debt relief program how it works
Freedom Debt Relief is a US debt resolution company. It is currently based in San Mateo, California and is a wholly owned subsidiary of Freedom Financial Network, a financial service company also headquartered in San Mateo. The company states that it has more than 600 employees.
Contents
Company History
The company was founded in 2002 by Andrew Housser and Bradford Stroh. Both are Stanford Graduate School of Business graduates.
The company negotiates on behalf of indebted consumers who are experiencing a financial hardship with the goal of avoiding bankruptcy (Chapter 7 or Chapter 13) by settling their unsecured debt at a discount to what is actually owed. The company primarily serves consumers where debt consolidation or home refinancing is undesirable or an unavailable option. They also serve those who cannot afford either their credit card minimum payments or the payments required in credit counseling.
With the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act and the financial crisis of 2007-2009, debt relief options for consumers significantly decreased for both bankruptcy and mortgage refinance, increasing the demand for debt settlement and resolution.
On November 4, 2009 Andrew Housser and Robert Linderman, general counsel, participated as panelists at the Federal Trade Commission's public forum on "Debt Relief Amendments to the Telemarketing Sales Rule." The forum discussed proposed fee regulation and rules to eliminate deceptive and abusive telemarketing of debt relief services. In a letter to the FTC Linderman stated in the first nine months of 2009 alone Freedom Debt Relief successfully settled approximately 40,000 accounts aggregating more than $206 million of unsecured debt with savings to consumers in excess of $120 million. On November 11, 2009, the company announced it had settled more than $500 million in consumer debt since its founding.
Working with nearly 100,000 clients since 2002, the company reached the $1 billion mark of savings for their customers in December 2010. They did this by negotiating settlements on 188,000 individual creditor accounts for its clients becoming the first debt resolution company in the country to reach $1 billion in cumulative debt it has resolved for clients. Housser was quoted saying “The achievement of obtaining $1 billion in settled debt – not just offers, but completed settlements – for consumers is positive proof of FDR’s ability to assist individuals who are in serious debt. From truly humble beginnings, FDR has maintained its singular commitment to save as much money as possible for each client who turns to the company for debt relief.”
Regulatory Issues & Legal History
Freedom Debt Relief has played a prominent role in promoting consumer protection legislation and regulation. In 2009 Freedom Debt Relief contributed to and supported the passing of federal regulatory measures that brought additional consumer protections to the industry*. During the drafting of the new regulations, the Federal Trade Commission received testimony from Freedom Debt Relief clients from around the country including California, Oregon, Texas, Wisconsin, Michigan, Ohio and Colorado.
At the state level not all states require licensing, but Freedom Debt Relief has supported efforts to create licensing requirements in Delaware, Iowa, and Minnesota and became the first company to be awarded licenses for settlement services in those states. In addition to Delaware, Iowa and Minnesota, Freedom Debt Relief is also currently licensed to do business in the following states: Maine, Kentucky, Utah and Colorado.
Since the creation of the current regulations there have been a number of legal disagreements between regulators and the debt settlement industry. The legacy of the non-regulated debt settlement industry set-off several legal battles between Freedom Debt Relief and several states. To bring closure to these legal stand-offs, Freedom Debt Relief agreed to settle with the states that had filed complaints during the pre-regulation timeframe. In every case, the complaints were settled with Freedom Debt Relief being found free of any wrongdoing or liability. As part of some of the settlements, the company did offer reimbursement funds to the states (New York for example) and a limited number of qualifying individuals involved in the complaints.