Richard Nikoley
Co-Founder and Chairman, Provanta Corporation.

rnikoley@gmail.com

Newsflash: Bankruptcy Lawyers Say Debt Settlement is a “Trap to be Avoided”

But only “For Most.” How very magnanimous of them. But one needn’t look far into the article to identify Craig Andresen’s — Attorney at Law — inherent and absolute bias.

In the past several years, there has been dramatic growth in the visibility of so-called debt settlement agencies. These are firms which advertise their supposed ability to “cut your credit card payments in half,” or promise they can “settle” your debt for only a small portion of what you owe — without filing bankruptcy.

We’ve got “so called;” there’s a “supposed ability;” and how could we leave out the very scary “’settle.’” Well, Mr. Andresen, check for yourself. We actually publish our weekly and monthly settlement stats — even the “worst” settlement, which even you oughtn’t find all that scary, Mr. Andresen. What? Do you wrongly suppose that the concept of settling disagreements, disputes, or breaches of written or verbal contracts arose only after thousands of years of human interaction, only to be bestowed upon us lucky ones by the legal profession? Real people can’t arrive at settlements without a lawyer (or two or three…) in-between them, drafts upon drafts of legal documents; file endorsed to boot?

Well, I think that what Mr. Andresen really means by “For Most” is “None;” and “Never.”

[Read more]

Transparency

Probably the primary reason in going to a blog format for our corporate website was to demonstrate transparency in those elements of our services that might be of some concern to potential clients. The nature of our services are such that we set about to solve serious problems that some people find themselves in. You may be able to do without many of the goods and services you could buy — or consider buying — because not having those goods and services is not really a problem in your life. But when you can’t sleep at night, or when financial hardships cause friction between spouses, resulting in lots of stress on the kids, then there might be undue motivation to engage the sorts of services we have to offer.

Accordingly, we want to be particularly careful that you’re really, really sure that you want to do this. It’s not a walk in the park. It’s “surgery,” in a sense, and though the light at the end of the tunnel is indeed bright, warm and pleasant, the path to that light is not without risks and unpleasantness. You need to understand that potential, accept it, and commit yourself to doing the best you can to tolerate it. Some people can’t, and we want you to know that.

I could probably write a nice long post about all the aspects of transparency, why it’s good for everyone, and why it’s the future of business. But if I did, it would surely not be as good as Greg Swann’s post on the same topic. Greg is a Phoenix Realtor, a longtime friend and business associate, and he practices transparency against the prevailing tide.

Technorati Tags: debt settlement, marketing transparency

Did You Know All This?

While we at Provanta celebrate and applaud the do-it-yourselfer, it’s a step that ought not be taken lightly without really considering what you need to know in order to set yourself up for success. Let’s consider one aspect of settling your debts, working with debt collectors.

Here’s a post from a lawyer explaining just a bit about the Fair Debt Collection Practices Act (FDCPA), as enforced y the Federal Trade Commission (FTC):

“No, A Debt Collector Can’t Threaten You With a Baseball Bat”

At Provanta, our negotiators know the legal rights of its clients. What’s more, the collection agencies know that Provanta knows, so this in itself tends to protect clients from the worst abuses. Even still, our clients file a significant number of complaints every year on the FTC website.

Technorati Tags: fdcpa, fair debt collection practices act, debt collector

Recognizing Provanta’s Honesty and Leadership

Jeff Michael, author of Repair Your Credit and Knock Out Your Debt, as well as the proprietor of a debt recovery industry watch blog, has some very nice things to say about Provanta’s new approach to its corporate website. Jeff is from the credit counseling arena of the debt recovery profession, and he’s always been reasonable and fair in his assessments of debt settlement as an option for some people.

I really, really like it. At first, it’s a novel idea to have a corporate site that is essentially a blog. It’s a smart (and inexpensive) way for a company to set up their web presence that says a lot about the company.

But it’s also nice to see our efforts so well understood in our first outside recognition:

And after reading most of the site, it’s not just the fact that it’s a blog that is impressive, it’s the content of the posts. I don’t know else where you’re going to find this much honesty on a debt settlement negotiator’s site, or on any corporate web site.

It reminds of the the whole idea of public companies vs. private companies (Provanta is privately held). The basic idea is that public companies have a whole host of reporting requirements so that investors presumably have all they need to make an informed investment decision, should they be inclined to purchase stock in the company. Of course, as we’ve seen in one corporate scandal after another, it’s not only fraud (”cooking the books”) that’s a problem, it’s that corporate interests have the “advantage” of millions of dollars towards lobbying efforts. It’s hard not to view the plethora of barrier-to-entry securities regulation as “the best set of laws money can buy.” At Provanta, we want to do our part in leading the way to a point where one day, the chief competitive weapon small, private companies have against the massive ones is that they don’t hide behind elite spin public relations firms. That’s not to say we’re going to be posting our P&L or tax returns, but we do want to be as open and transparent about the true nature of the services we perform for clients as possible.

FTC Issues 2008 Fair Debt Collection Practices Report to Congress

According to the FTC website:

Issuance of Commission report to Congress: The Commission has authorized the staff to release publicly the 30th Annual Report to Congress on the Fair Debt Collection Practices Act (FDCPA). This report, which is available now on the FTC’s Web site, summarizes the Commission’s administration and enforcement of the FDCPA during 2007. It presents an overview of the types of consumer complaints received by the Commission, descriptions of the Commission’s debt-collection law enforcement actions, and a summary of the Commission’s consumer and industry education initiatives. The FDCPA prohibits deceptive, unfair, and abusive practices by third-party debt collectors. Section 815 of the FDCPA requires the Commission to submit annual reports to Congress. The Commission vote to issue the report was 5-0. (FTC File No. P084802; the staff contact is Karen Hickey, Bureau of Consumer Protection…

The 16-page report (PDF) can be obtained here. Among many items of note in the report…

These actions are part of the Commission’s ongoing effort to curtail deceptive, unfair, and abusive debt collection practices in the marketplace. Such practices cause substantial consumer injury, including payment of amounts not owed, unintended waivers of rights, invasions of privacy, and emotional distress.

[...]

The Commission staff held a two-day public workshop in October 2007 to examine the industry and a number of current issues. The staff invited consumer advocates, industry representatives, state and federal regulators, and other experts to provide information and their views on the collection industry and related policy issues.

Of course, what the FTC may likely be unaware of is that the debt settlement industry is the perfect “private enforcement” of professional debt collection practices. We see violations of the FDCPA virtually every day at Provanta, and while most are not of the most egregious sort (child answers the phone; debt collector informs child he’s going to put mommy and daddy in jail if they don’t pay up), professional debt settlement companies go a long way towards mitigating the embarrassment and abuse that can result from a sincere financial hardship.

A suggestion concerning the FTC’s workshop: The Association of Settlement Companies (TASC), of which Provanta is a proud member, ought to field representatives from our industry the next time around.

I’ll have more to say about the FTC’s report in subsequent entries.

Technorati Tags: ftc, fdcpa, debt collection, debt settlement, tasc

We’re Live

Welcome. It’s an exciting time. In 15 years of serving clients in need of debt relief, and many website designs going back as far as 1994 or ‘95, I have never been so pleased.

It’s not done, but that’s part of what’s pleasing. In fact, a website should never be done. It should remain fresh, relevant, and alive to the people kind enough to browse by. So thank you for your visit.

It’s not done. It’ll never be done. But hopefully it will provide free information about debt, credit, debt help and financial good sense that will be of some benefit to you whenever you come to check on our progress towards never being done.

New Look; New Everything

This marks the beginning of an entirely new website strategy for Provanta. When you think about it, most company websites could be generated a lot faster, easier, and less costly if one were to simply scan a business card and a company brochure, and put it up there to collect dust. Not even any need to publish text, because unless there are tons of other sites linking to you, unless you publish new and fresh information regularly (daily), you’re simply going to be uncompetitive and increasingly irrelevant in a new world that’s about “what have and can you do for me lately!”

So why am I revealing our new strategy to the world, to potential competitors? Well, they’ll figure it out anyway; but more importantly, I’ll welcome this kind of competition. If they think they can match our daily relevance, freshness, and interest in a wide array of personal financial topics focussed on getting out of debt and getting on with life, then they are invited to bring it.

More — much more — later.