The Checkout

AmeriDebt Founder Settles Deception Charges

Andris Pukke, who was once called the "poster child" for bad credit counseling, has settled two lawsuits that accused him and his firms, AmeriDebt and DebtWorks, with deceiving financially strapped consumers into paying high fees and then using that money for expensive homes, vacations and cars. (Read the full story)

The settlement calls for Pukke's assets, including his multimillion dollar homes in California and Florida, to be sold and up to $35 million be placed in a special fund to be refunded to the 300,000 former AmeriDebt customers. The settlement of the two cases--one by the Federal Trade Commission, the other a national class-action lawsuit by former AmeriDebt and DebtWorks customers--must still be approved by a judge.

FTC officials yesterday said AmeriDebt customers do not need to file any paperwork to get the money; however, any customer who has moved may want to call the agency and give it the latest contact information. The FTC hotline number for AmeriDebt is 877-862-0886.

By  |  January 10, 2006; 8:00 AM ET Legal Battles/Settlements
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One impact of the new bankruptcy law is the harm it places on risk taking entrepreneurs. Small businesses are typically financed out of pocket from the proprietor. Perhaps he benefits from a small business loan but much of the capital comes from him personally. It used to be that if his business failed he had the option of declaring bankruptcy and getting a fresh start to take care of his family. Instead, with the new law, entrepreneurs may be more risk averse. This will have long term consequences because it is the "little guy" who serves as the job creating engine in this country. It is wrong that a mega corporation can even under the new law declare bankruptcy and default on their pension obligations. But the little guy does not have that option. All because the politicians in both parties are beholden to the banks and credit card companies at the expense of middle class America. Shame on all of us for allowing this to happen.

http://www.intrepidliberaljournal.blogspot.com

Posted by: Intrepid Liberal | January 17, 2006 10:13 AM

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