Across several fronts, the U.S. government has recently moved to increase its oversight of the debt consolidation industry, according to a recent report from USA Today. The newspaper reports that legislators, regulators and consumer advocates have all said that they are interested in helping to clean up the business sector.
Critics say that the practice of charging up-front fees for some debt consolidation services can actually make it harder for consumers to reduce debt by cutting into the amount of money they can put into paying down their obligations, USA Today reports. The Federal Trade Commission and New York Senator Charles Schumer have both expressed an interest in curbing this practice, according to the paper.
There were some success stories, however, from the industry as it is currently regulated included in the USA Today report, including one Texas woman whose unemployment-related credit card debts were eventually settled for roughly half of their outstanding balances.
Experts say that, as the economy continues to improve, fewer U.S. consumers will have need of such services. However, financially healthy Americans could help the recovery happen even faster.