Lately, if I spend any time in the car with the radio on I will hear an advertisement commanding me to “call and request a your FREE CD”.
These ads run year-round but pick up steam this time of year.
I remember one time I must have been listening to a radio station with an older demographic because the command was “call and request your free cassette tape”.
The free CD is supposedly an introduction to this guys “get out of debt” program.
He’s been around for awhile, I’m sure he’s helped many people but now his sales process is frankly, disgusting. Fortunately, I don’t know this from personal experience but from the experiences of my readers who’ve told me about this scam.
Here is how the sales process generally works: at some point you will receive a phone call from this organization. They will survey you about your debt situation. They want to know how many credit cards you have, how much you owe on each card, and how much available credit you have left on those cards.
They request this information ostensibly to begin the process of helping you get out of debt.
Really what they are doing is finding out how much available credit you have. When they have that information they will then direct you to a coaching/educational program with a price tag of up to $14,000.
And if you say “but I don’t have $14,000 available on one card, out of the goodness of their hearts they are happy to divide the $14,000 charge amongst as many cards as necessary.
So, if you have $1000 available on card #1 they will charge $1000 on card #1. Then if you have $3500 available on card #2, they will charge $3500 on card #2 and so on until you have paid for your “education”.
Here’s a report I received last year from one of my readers:
“I invested in (the $99 program)
and got suckered into the
coaching program. I doubled
my credit card debt and basically have
nothing to show for it but bigger bills.
They sold me the coaching program
before I even received the ($99)
materials. There are three levels,
1 year for $14,955, 9 months for
$13,195, 6 months for $11,435 and
3 months for $7095.
They sell you whatever will fit on your credit
cards, or they will finance it through
HSBC Bank of Nevada if you qualify.
I ended up with a 3 month program
for $7095, which (salesperson) had
figured out and split up on the
available balances on three of
my credit cards before I
could blink, let alone think.
When I got off the
phone that night and got
a while to clear my mind, I felt
sick.
I wondered what in the world
coaching could do for me that is
worth $7095. I later read on
the internet that when another guy
declined the coaching they berated
him, saying he didn’t really want to
solve his problem, etc.
The coaching gave me nothing more
than the original program
except he encouraged me to find
a 2nd job or home business. They
guarantee me more calls that
really don’t help in any way.”
Linda
* * *
Here are some other reports I found on the Internet:
4/18/2009 – Susan writes:
”I was stupid enough to call the 800 number
from the infomercial that was played
over and over on the radio with the man
saying I paid off my 30-year mortgage in
2 and a half years.
Wow. I believe I gave my credit card number
for shipping the free tape that came along with
over $500 of material I didn’t want, never opened,
and have been trying to return. There was
no packing list, invoice, or return
address; only a card with another 800
number for a free coaching session.
This coaching session turned out to be a high-pressure
sales pitch for over $11,000 worth of coaching on
how to get out of debt.
The velvet-voiced man kept me on
the phone for over 2 hours, and finally
convinced (distraught, vulnerable, broke
single-mom) me to sign up for this.
What was I thinking?? This has now ruined
my credit and left me with more debt than
I can repay. It took 2 sessions to figure
out I had made one of the biggest mistakes
in my life.
Now this program has
piled hundreds of dollars onto my credit
card and an $11,000 loan from some
bank with 22.2% interest. Help!! How do
I recover from something like this??”
3/12/2009 – Bob writes:
”When I spoke with a salesperson, I said
If I give you my credit card number, I
only agree to the shipping charge of
between $4.00 and $5.00 The answer was
yes.
I got some reading material and discs.
There was a phone number to call if
you had questions. Of the three people
I called and asked the question: How
does an equity line of credit fit into this
plan to reduce debt… Each answer was
the same, I can’t answer that but you will
get the answer when you buy the total
program.
I made no further contract with
them. I now learn that I am being
charged 5 payments of $89.98 each month.
This money was removed from my
credit card account without my agreeing to it.”
DON’T GET ME WRONG
I’m all for free enterprise and making a profit and if their pitch was “request
your free CD about our financial coaching program”, well OK then but to use “get out
of debt” as the bait for this is unconscionable.
Plus, there is no way they can justify making people go $7095+ deeper
into debt for “get out of debt” coaching.
Of course, they don’t call it “get out of debt” coaching they call it “education”.
I’ve not personally heard the sales pitch but I suspect they compare the cost of
a college education to the cost of their “education”. They probably ask you
questions like “do you think if you had been better educated financially you
could have avoided these problems?”
They will teach you about investing, the stock market, budgeting, CDs and
compound interest etc. etc. etc.
I’m quite certain these “coaches” are minimum wage employees who sit around
waiting for the phone to ring with people asking questions. The “answers” are
likely in some big binder or computer program they use.
You could get a pretty good financial education at a local community college
for a fraction of the $10,000 from people QUALIFIED to teach you.
Bottom line: Avoid the “FREE CD” guy at all costs. If you can pay all your bills on time now,
I can think of at least one MUCH better option. 
If you are behind on your finances get local help from www.NFCC.org
The specific page on that site is:
http://www.debtadvice.org/takethefirststep/locator.cfm
Best wishes for a happy and prosperous new year,
Leo Quinn
