- CCCS - *** 13 Important Questions ***

Burlesque_Babe

DebtorsLittleHelper wrote: »

no matter who they might be are in the firing line and would not wish to divulge such information in order to face persecution.

why would you face persecution if you are a company who is up front with your fees and charges, and were 100% honest with who you were and exactly what you do? CCCS are very open and I can't see any of your questions which they would shy away from - to be honest, you need to be asking them many of your questions and Jesthar has answered some already.

RAS

DebtorsLittleHelper wrote: »

The fact of the matter remains that we do not face a level playing field with people being honest about their affiliations and commercial interests. All the post is about is receiving a decent honest reply to the questions posed and I begin to wonder if there is any prospect of that eventuality.

What I cannot compute is how it is better for a debtor to pay £100 per month to a fee paying company, of which say £85 goes to their creditors and £15 to your company rather then them pay £100 to CCCS, payplan or NDL and £100 goes to their creditors?

Not least because we see a number of really really desparate posters here who have been paying £100 a month ito a DMP for a decade and larger fees than those I suggest, even when they are on benefits and would have been better to have gone bankrupt years ago.

And the others who have paid fees for IVAs which result in virtually nothing going to their creditors and the debtor going bankrupt at the end of the second year.

I am not in favour of people bucking their responsibilities and am aware of the macro-economic implications of bad debt but I have advised a number of people to to have a chat with the debt charities and the BK board here and re-consider their options.

coolcait

DebtorsLittleHelper wrote: »

1. Why do CCCS openly admit to receiving funding from creditor companies?

Personally, I have no difficulty with openness, so I welcome it in others. Do you have a difficulty with the fact that CCCS are open about the source of their funding? If so, why?

2. How can they remain impartial if they are funded by the creditors?

I have no reason to doubt CCCS's impartiality. I would be more inclined to ask 'How can a fee charging company remain impartial if they are funded by the fees paid by the people they are advising to take out particular products?'

3. If they cannot remain impartial, how can they offer best advice?

As above, with reference to fee charging companies.

4. If they cannot offer impartial best advice, why should anyone trust their judgement?

As above, with reference to fee charging companies.

5. If they receive funding as a charity, how do they justify wages and bonuses of £1,960,000 to their directors? (according to figures published on Charity Commission)

Can you please provide a breakdown of figures in support of this claim? The Charity Commission Figures indicate merely that £1.96 million of income was 'retained' by CCCS. What evidence to you have that this sum was spent entirely on 'wages and bonuses to their directors'? Some may have been 'retained' at the end of that financial year, for disbursement at the beginning of the next FY, for example.

6. If they are truly impartial, why have they kept thousands of people on debt management plans when an IVA was the correct option for them?

IVAs, if recommended properly, are an alternative to bankruptcy rather than an alternative to a debt management plan. That may be one reason for 'thousands of people being on a DMP rather than an IVA' - a DMP fits their circumstances better than bankruptcy. There are also many people 'on a DMP rather than an IVA' because they do not have sufficient surplus income to enter an IVA, but can enter a DMP. CCCS's figures show that many of their clients are on a relatively low income, and as such may be less likely to be accepted onto an IVA. Those figures were contained in a report which - ironically - was brought to my attention by the last person I saw on MSE 'worrying' about CCCS's impartiality (and claiming that they 'never' recommended bankruptcy, when CCCS's own figures - as cited by that FM - show that bankruptcy was recommended in almost a fifth of the cases they dealt with).

7. Now they are able to offer IVA's (through a profit making organisation wholly owned by them), why have they suddenly begun to offer these as an alternartive?

Your question, unfortunately, is somewhat misleading. CCCS have recommended IVAs in the past - to some 3% of their clients in the year cited in the IVA guide- so they have not 'suddenly' started to offer them as an alternative now. It will be interesting to see if their figures on recommending IVAs rise significantly (over and above what would be expected in the current financial circumstances) now that they offer an IVA service of their own. I think it is a given that this will be closely monitored by many over the coming months.

8. Do you therefore in regard to the above, advocate that people should go to a biased, paid for service purporting to be a charity rather than go to a company who do charge, but offer best advice and are totally impartial, and honest about their fees?

CCCS is a charity, as evidenced by its registration with the charity commission. It is your view that it is 'biased'. I do not share your view. I refer you back to my answers to your questions 2, 3 and 4. CCCS are honest about their funding - it is on their website for a start. Fee charging companies cannot all say the same thing. 'Best advice' is a matter of opinion.

9. If so, please explain the logic behind your answer?

If you have difficulty understanding the logic of any of my answers, please indicate which answers you are having difficulty with, and why. I will endeavour to clarify. That said, I am having difficulty following the logic of your 'arguments', which seem to be based entirely on the presumption that if CCCS are funded by creditors, they must necessarily be biased. I have already made the point that a similar presumption could therefore be directed towards all fee charging companies.

10. Do you have any links personal, financial or business, whatsoever with the CCCS?

I don't.

11. How do you justify your stance against ethical debt management companies?

I have no 'stance' against ethical debt management companies. Unfortunately, I have had great difficulty in finding any fee charging debt management companies which meet that criterion.

12. How exactly do CCCS raise funds?

Wasn't your starting point your disquiet over the fact that they are funded by creditor organisations? This question therefore seems redundant (and if you removed it, you could have a round dozen 'important questions'.

13. Do they receive charitable donations other than from creditor companies and if so in what proportion?

I think you'd have to put that question to CCCS rather than anyone on here.

oscar52

10past6 wrote: »

Put your dummy back in the pram, and tell us who you work for, that is, if you've nothing to hide.

You forgot about the rattle.

insider66

DebtorsLittleHelper wrote: »

All the post is about is receiving a decent honest reply to the questions posed and I begin to wonder if there is any prospect of that eventuality.

I think you're fighting a losing battle DLH although I for one support your views.
I have heard horror stories about the CCCS telling their clients they should be paying huge amounts on a DMP that they simply cannot afford, or suggesting DMP's that would take impossibly long to clear the debts.

Unfortunately, i think you will find that any critisism of the CCCS here will fall on deaf ears... GOOD LUCK

insider66

The IRS also has weighed in on the subject of credit counseling, and has denied nonprofit 501(c)(3) tax-exempt status to around 30 of the nation's 1000 credit counseling agencies. Those 30 credit counseling agencies account for more than half of the industry's revenue. Audits of non-profit credit counseling agencies by the IRS are ongoing.
The lobby against credit counselors arises from the belief by the collection industry that the not-for-profit status of the credit counselors gives them an unfair financial and market advantage over them. The IRS apparently agrees. The tax exempt revocations seem to be centered around whether a tax exempt credit counselor actually performed their mandated mission by assisting the community at large, other than their whole attention to their own DMP customers in a "collection practice" (no one knows for sure
however).

A credit counseling agency typically receives most of its compensation from the creditors to whom the debt payments are distributed. This funding relationship has led many to believe that credit counseling agencies are merely a collections wing of the creditors. This fee income, known as “Fair Share,” are contributions from the creditors that originally earned the agency 15% of the amount recovered. However, in recent years, Fair Share contributions have dwindled steadily, with contributions of 4-10% being the most common.
Still the NFCC considers bankcard companies to be one of their primary "constituents," and the NFCC website promotes the fact that they collect $5 billion for creditors each year. It also promotes their efforts to steer consumers away from bankruptcy.




The above is what is happening in the US - the same situation with the CCCS here being funded by creditors.

To those that still believe the CCCS is impartial, may I respectfully suggest that just because it seems to be the best we have, it doesn't make it right, and maybe you should look into this a little more seriously.

As long as the funding comes from the people owed the money - it can never be an impartial service with the consumers interest at heart.

coolcait

insider66 wrote: »

The IRS also has weighed in on the subject of credit counseling, and has denied nonprofit 501(c)(3) tax-exempt status to around 30 of the nation's 1000 credit counseling agencies. Those 30 credit counseling agencies account for more than half of the industry's revenue. Audits of non-profit credit counseling agencies by the IRS are ongoing.
The lobby against credit counselors arises from the belief by the collection industry that the not-for-profit status of the credit counselors gives them an unfair financial and market advantage over them. The IRS apparently agrees. The tax exempt revocations seem to be centered around whether a tax exempt credit counselor actually performed their mandated mission by assisting the community at large, other than their whole attention to their own DMP customers in a "collection practice" (no one knows for sure
however).

A credit counseling agency typically receives most of its compensation from the creditors to whom the debt payments are distributed. This funding relationship has led many to believe that credit counseling agencies are merely a collections wing of the creditors. This fee income, known as “Fair Share,” are contributions from the creditors that originally earned the agency 15% of the amount recovered. However, in recent years, Fair Share contributions have dwindled steadily, with contributions of 4-10% being the most common.
Still the NFCC considers bankcard companies to be one of their primary "constituents," and the NFCC website promotes the fact that they collect $5 billion for creditors each year. It also promotes their efforts to steer consumers away from bankruptcy.




The above is what is happening in the US - the same situation with the CCCS here being funded by creditors.

To those that still believe the CCCS is impartial, may I respectfully suggest that just because it seems to be the best we have, it doesn't make it right, and maybe you should look into this a little more seriously.

As long as the funding comes from the people owed the money - it can never be an impartial service with the consumers interest at heart.

I think that the sentence I have highlighted in your post might well apply to the campaign we are seeing against CCCS on here :rolleyes: .

The situation in the US does not seem to me to be "the same situation with the CCCS being funded by creditors". If anything, the US agencies being targetted by the IRS seem to be more similar to the UK's IVA factories - cold calling, hard selling, millions of dollars in advertising campaigns. There are suggestions of outright criminal practices.

I would be interested in a link to the original article, insider. Last time you quoted an extract from a report, you left out part of the original - which gave a different spin to the information.

I have made my points about CCCS to you a number of times, so I shan't repeat them here (especially as you felt it was too much to read through first time round :rolleyes: ).

I have looked at the claims you have made about CCCS, and have not been convinced by them (I do think you undermined your arguments tremendously by claiming that CCCS never recommended bankruptcy, and then linking to a report showing that they had recommended bankruptcy to almost a fifth of their clients in the year covered by the report).

I retain my view that there is at least as much risk of feecharging companies being unable to provide an impartial service with the consumer's interests at heart. Given the documented concerns about the mis-selling of IVAs in particular, I think that the risk is actually greater where such companies are concerned.

insider66

Hi again Coolcait

Whilst I appreciate your views regarding fee charging companies, and am inclined to agree with you broadly speaking - there are some sharks out there... It is not the point of this discussion.

I maintain my view that the CCCS and others who are funded by the creditors cannot be impartial and give the best advice for the consumer.

They tread a fine line between giving good advice to the consumer and getting as much of the creditors money back as possible, and it seems clear from their published figures as we have discussed before, that this balance is firmly on the side of the creditors by ensuring the majority of their clients are advised to pay the money back via a DMP.

Surely it's clear that if the CCCS didn't get so much money back, the creditors would think twice about the money they pay them?

I'm sure the CCCS are founded on good intentions, but impartial? I think not.

RobertoMoir

DebtorsLittleHelper wrote: »

1. Why do CCCS openly admit to receiving funding from creditor companies?
- Are you suggesting things would be better somehow if they kept this secret?

2. How can they remain impartial if they are funded by the creditors?
- Define "impartial". I didn't think it was a secret that CCCS are there to find a way for debtors to pay off their debt, if that's what you mean.

3. If they cannot remain impartial, how can they offer best advice?
- Depends on your definition of impartial, again. Assuming their (not exactly a secret) goal of getting debts repaid, and they are not paid in such a way as to favour one creditor over another, then what is wrong with their advice?

4. If they cannot offer impartial best advice, why should anyone trust their judgement?
And if I disagree with the first part of your statement here, the second part is moot.

5. If they receive funding as a charity, how do they justify wages and bonuses of £1,960,000 to their directors? (according to figures published on Charity Commission)
- Probably the same way other charities do. Which isn't to say I personally agree with this practice, but if you want decent people you have to follow the market, right?

No debt management organisation that I'm aware of is perfect but it's pretty clear that you have a serious case of sour grapes.

ANY_CHANCE

i was advised by cccs to pay one pound to creditors so they were certainly looking after my interests