Debt Settlement


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How Do I Get My Money Back from Morgan Drexen?


Dear Steve,

I entered into an agreement with Morgan Drexen for debt settlement. I paid them in excess of $3000. and they did nothing to help me. They lied to me several times regarding where my money went.

What recourse do I have?

Thank you.


Normally Id suggest you follow my guide How to Try to Get a Refund From a Debt Relief Company but the case of the debt settlement company Morgan Drexen is a different matter.

You see, Morgan Drexen was shutdown as a result of a Consumer Financial Protection Bureau (CFPB) court action. According to the Morgan Drexen website which is now under control of the Trustee in this case or CFPB, On June 19, 2015, Morgan Drexen shut down its business after a federal court ordered the company to stop collecting money for debt settlement work. The court ruled that Morgan Drexen broke the law. The company is now in bankruptcy.

But in an article yesterday, click here, I mentioned how the CFPB is interested in talking to anyone who has been approached to continue their accounts with any other firm. The CFPB advice is to contact the CFPBs Consumer Response team at (855) 411-2372.

Again, according to the confiscated Morgan Drexen website the following advice is offered to consumers:

Morgan Drexen filed for bankruptcy and went out of business after a court ruled that Morgan Drexen violated the law. Morgan Drexen is not doing any more debt settlement work. This means that you must take action and make choices about your debts. If you have one or more settled debts, Morgan Drexen will not send your payments to the creditor for you. You must begin to make your payments directly to your creditors for any debts that have been settled but not yet paid off. Please contact any creditors with whom you have settlements. Act quickly to avoid losing the reduced debt of your settlement.

For debts that were not settled, you will need to consider other options. Morgan Drexen is not in business and cannot settle these debts. You can negotiate directly with creditors, begin making payments, or consider other options such as bankruptcy. This websites Debt Resources page has free information from the federal government to help people with their debts.

To see what debts are settled and what debts are not settled, log into your account. Find information about the due dates and payment amounts for your settlements. A checklist of next steps available can help you take action and protect your rights.

A letter and email were sent to you with information about your debts and what you need to do. The worksheet of next steps was included in the letter. Please look for the letter or email from Morgan Drexen. It will tell you how to protect your rights.

Your creditors are being told that Morgan Drexen has gone out of business. We have asked creditors to work with you on your debts. If you have any questions, please visit our FAQ web page.

At this time your recourse is a bit limited. You can file a complaint with the CFPB or call them, watch your mail for information from the court regarding the Morgan Drexen bankruptcy and how to file a claim for some refund due you, and take over dealing with your creditors or find someone else to help you with your debts.

From experience, these things never work out so consumers are made whole again. Inevitably people never get but a fraction of the money they paid, back. Id be shocked if you did. However the CFPB is telling consumers to contact the attorney who was assigned to handle their account and demand whatever money back that is currently being help in a trust account on your behalf by the attorney. I think it will be a much smaller number than what you paid since fees were generally extracted from consumer deposits in advance of settlements.

What has been more alarming in the past days or week has been emails from readers claiming theyve been approach by another company to who has taken over or is now managing their account. Click here for articles about that.

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This article by Steve Rhode first appeared on Get Out of Debt Guy and was distributed by the Personal Finance Syndication Network.

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