Freedom Debt Relief Complaints: What to Know Before You Enroll

Key Takeaways

  • Freedom Debt Relief settled a federal lawsuit with the Consumer Financial Protection Bureau in July 2019, paying $20 million in restitution to affected consumers and a $5 million civil money penalty, according to the CFPB’s own enforcement records (CFPB: CFPB v. Freedom Debt Relief, LLC)
  • Freedom Debt Relief charges fees of 15% to 25% of your total enrolled debt, calculated on the amount you originally enrolled, not on the amount actually settled (freedomdebtrelief.com/facts)
  • Freedom Debt Relief and Turnbull Law Group are both currently part of a pending investigation by the Georgia Attorney General’s consumer protection division, confirmed by a GA AG spokesperson (Atlanta News First, March 10, 2026)
  • The BBB shows 281 complaints filed against Freedom Debt Relief in the last three years, with 86 closed in the last 12 months, despite the company holding an A+ BBB rating (BBB.orgFreedom Debt Relief complaints, verified June 2026)
  • Justice Consumer Law offers a free consultation. If we win, the other side pays our legal fees. If we don’t, you owe us nothing.

Freedom Debt Relief is one of the most recognized names in debt settlement. The company says it has served over one million clients and resolved more than $20 billion in debt since its founding in 2002. (freedomdebtrelief.com/about) For many people, that track record sounds reassuring. But the public record tells a more complicated story.

In November 2017, the Consumer Financial Protection Bureau filed a federal lawsuit against Freedom Debt Relief and its co-CEO, Andrew Housser. The CFPB alleged that Freedom charged consumers without actually settling their debts, made some consumers negotiate with creditors themselves while still collecting professional fees, and misled consumers about which creditors would negotiate with a debt settlement company. The CFPB also alleged that Freedom did not tell consumers they could get their deposited money back if they left the program. (CFPB: Bureau Settles Lawsuit Against Freedom Debt Relief, July 9, 2019)

The case settled in July 2019. Freedom paid $20 million in restitution to affected consumers and a $5 million civil money penalty. That $25 million total was entered as a court order by the U.S. District Court for the Northern District of California, case number 3:17-cv-06484-EDL. (CFPB: CFPB v. Freedom Debt Relief, LLC)

That settlement is now part of the public record. And more recently, the Georgia Attorney General’s consumer protection division confirmed that both Freedom Debt Relief and Turnbull Law Group, a Chicago-based debt settlement firm that uses Freedom to answer its phones, are currently part of a pending investigation. No charges have been filed as of March 2026. (Atlanta News First, March 10, 2026) Consumers may still pursue individual claims for damages under federal and Illinois laws.

The Record Against Freedom Debt Relief

What the CFPB Found Against Freedom Debt Relief

1. Fees Charged Before Debts Were Settled

Freedom Debt Relief told consumers it would only charge fees after a settlement was reached and a payment was made toward that settlement. The CFPB alleged that Freedom did not follow that rule. According to the settlement press release, the company charged fees in cases where no settlement had been reached and no payment had been made to any creditor. Consumers paid fees for results they never received. (CFPB: Bureau Settles Lawsuit Against Freedom Debt Relief, July 9, 2019)

2. Consumers Forced to Negotiate Their Own Debts

In some cases, Freedom Debt Relief did not negotiate with creditors directly. Instead, the company coached consumers on how to approach creditors themselves. The consumer made the call. The consumer reached an agreement. But Freedom still collected its full professional fee for the outcome. The CFPB alleged this was a violation of the Consumer Financial Protection Act. Consumers had enrolled specifically to avoid doing that work themselves. (CFPB: Bureau Settles Lawsuit Against Freedom Debt Relief, July 9, 2019)

3. Misleading Claims About Creditor Participation

Freedom marketed itself as a company with strong negotiating power across a wide range of creditors. The CFPB alleged that Freedom knew certain major creditors had policies against negotiating with debt settlement companies. Despite knowing that, Freedom continued to promote its negotiating reach without telling consumers upfront that some of their creditors might not participate at all. That left consumers enrolled in a program that could not resolve some of their most significant debts. (CFPB: Bureau Settles Lawsuit Against Freedom Debt Relief, July 9, 2019)

4. Consumers Not Told They Could Get Their Money Back

When you enroll with Freedom Debt Relief, you deposit money each month into a dedicated account. That account belongs to you. The CFPB alleged that Freedom did not clearly tell consumers they had the right to withdraw those funds and leave the program at any time. Some consumers stayed in a program that was not working for them, in part because they did not know they could get their deposited money back. (CFPB: Bureau Settles Lawsuit Against Freedom Debt Relief, July 9, 2019)

Consumer Complaints Against Freedom Debt Relief

At Justice Consumer Law, we see clients affected by debt relief companies whose practices do not match what was promised at enrollment.

Common Complaints

    • One consumer enrolled in July 2025 and paid $3,645.96 into the program. Of that amount, $2,657.71 went to fees. The consumer also reported being charged a $9.95 monthly service fee that was not clearly disclosed at enrollment. The consumer said that if those fees had been properly explained, she would not have agreed to participate. (BBB complaint, April 28, 2026)
    • A second consumer paid over $16,000 since enrolling in 2025 and reported that not one debt had been resolved. She had $1,113 in her account when Freedom voided a settlement rather than make the final payment. (BBB complaint, April 29, 2026)
    • A third consumer called to cancel her account on April 21, 2026 and was told the cancellation was already in process. Freedom reactivated her account without her authorization, resulting in a $230 fee being charged on April 29. (BBB complaint, April 30, 2026)
    • A fourth consumer-initiated account closure the week of April 30, 2026. A representative explicitly assured her that no fees would be charged during the closure. Her account balance dropped from $700 to $434 immediately after closure. (BBB complaint, May 6, 2026)

Red Flags to Know Before You Enroll

    • The fee is calculated on your total original enrolled balance. If you enroll $50,000 and the fee is 20%, you owe $10,000 regardless of whether your creditors settle at 40 cents or 55 cents on the dollar. The fee does not shrink if results fall short (freedomdebtrelief.com/facts)
    • The program requires you to stop paying your creditors. Accounts then fall behind and go into collections. Your credit score drops while you wait for negotiations to begin
    • Federal student loans, taxes, utility bills, auto loans, and secured loans cannot be enrolled in the program at all (freedomdebtrelief.com)
    • Creditors are not required to settle. If a creditor refuses to negotiate, that debt stays unresolved while your credit continues to suffer
    • Freedom Debt Relief answered incoming calls for Turnbull Law Group, a Chicago-based debt settlement firm now named in a pending Georgia AG investigation (Atlanta News First, March 10, 2026)

Your Legal Options If Freedom Debt Relief Harmed You

1. Claims You May Be Able to File

You may be entitled to compensation if Freedom Debt Relief:

    • Charged fees before settling any of your enrolled debts, which may violate the FTC Telemarketing Sales Rule
    • Required you to negotiate your own settlement with a creditor while still charging professional fees
    • Did not clearly disclose your right to withdraw funds from your dedicated account before you enrolled
    • Misled you about which of your creditors would negotiate with a debt settlement company
    • Did not provide a clear written fee breakdown before you signed your enrollment agreement
    • Debited your account after you submitted a valid cancellation request

2. Federal and State Laws That Apply

2.1 Credit Repair Organizations Act (CROA), 15 U.S.C. §§1679 through 1679j

A debt relief company cannot collect fees before it delivers results. A written contract must be provided before any services begin. If those rules were violated in your case, you may be entitled to actual damages plus punitive damages. Attorney fees are recoverable under this law, which means you do not need money up front to pursue a claim. (JCL: CROA claims)

2.2 FTC Telemarketing Sales Rule, 16 CFR § 310.4

A debt relief company cannot charge fees until at least one debt has been settled and the consumer has made at least one payment toward that settlement. This is the same federal rule the CFPB alleged Freedom Debt Relief violated in its 2017 complaint. If fees were collected from you before any debt was resolved, that may already be a federal violation. (JCL: CROA claims)

2.3 Illinois Consumer Fraud Act, 815 ILCS 505

This law covers deceptive business practices and allows you to recover actual damages plus attorney fees. Courts may apply enhanced penalties when the practices target financially vulnerable consumers. The statute of limitations is three years. (JCL: Consumer fraud protection)

Better Alternatives to Freedom Debt Relief

Alternative Cost Credit Impact Success Rate Time to Complete
Nonprofit Credit Counseling Free to $50 per month Neutral to Positive High 3 to 5 years
Direct Creditor Negotiation $0 Varies Moderate to High 6 to 18 months
Chapter 7 Bankruptcy $1,500 to $3,000 Negative initially, recovers faster Very High 4 to 6 months
Freedom Debt Relief 15% to 25% of enrolled debt Very Negative Not guaranteed 24 to 48 months

1. Nonprofit Credit Counseling

    • Free or low-cost help with no credit damage required
    • Debt management plans that keep your credit intact
    • Find approved counselors at justice.gov

2. Direct Creditor Negotiation

    • Call your creditors directly at no cost
    • No fees paid to any third party
    • Many creditors prefer working directly with consumers

3. Legal Consultation

Why Justice Consumer Law for Freedom Debt Relief in Chicago

Exclusive Consumer Protection Focus: We only handle cases against companies like Freedom Debt Relief that are accused of violating consumer rights. Attorney Marwan R. Daher has nearly a decade of experience representing clients nationwide in federal litigation against debt relief companies, creditors, and credit reporting agencies. (JCL: About Us)

No Risk to You: Our no-cost guarantee means you pay nothing unless we recover money from Freedom Debt Relief or another company that harmed you. If we win, the other side pays our legal fees. If we lose, you owe us nothing.

Experience with Debt Relief Cases: We understand the specific tactics companies like Freedom Debt Relief are accused of using, including alleged fee collection before results, making consumers negotiate their own debts while charging professional fees, and misleading consumers about creditor participation.

Maximum Recovery: We fight to recover every dollar you may be entitled to under federal and Illinois consumer protection laws.

Take Action Today

Freedom Debt Relief paid $25 million to settle a federal CFPB lawsuit in 2019. The company is now named in a pending Georgia AG investigation confirmed as of March 2026. The BBB shows 281 complaints filed in the last three years. If Freedom Debt Relief’s practices harmed you, your legal options are available right now.

Contact Justice Consumer Law today:

  • Free consultation to review your Freedom Debt Relief case
  • No attorney fees unless we recover money for you
  • Experienced representation against debt relief companies accused of violating consumer rights

Remember: Time limits on legal claims are strict. The sooner you act, the more options you have.

FAQs

Does the 2019 CFPB settlement mean Freedom Debt Relief is currently breaking the law?

No. The 2019 settlement resolved allegations from 2017. The case is closed. What the settlement shows is a documented history of alleged deceptive practices, including charges before settlements and misleading consumers about creditor participation. If you experienced similar issues during your enrollment, you may still have individual legal options. Contact an attorney to review your situation.

What if Freedom Debt Relief says my fees were legally earned?

Under the FTC Telemarketing Sales Rule and the Credit Repair Organizations Act, fees can only be collected after a debt is settled and the consumer has made at least one payment toward that settlement. If Freedom charged fees before that point, the timing may conflict with federal law, regardless of what the company says. An attorney can review your specific situation.

How long do I have to take legal action against Freedom Debt Relief?

It depends on the type of claim. Illinois Consumer Fraud Act claims carry a three-year limit. Other federal claims carry different deadlines. Contact an attorney as soon as possible so you do not miss your window.

What if I am still enrolled with Freedom Debt Relief right now?

You have the right to withdraw your deposited funds from your dedicated account. That right was part of the 2019 CFPB settlement order. Before you do anything, gather all records of payments made, fees charged, and any settlements completed. Then contact an attorney to understand what your options are.

How does Justice Consumer Law’s no-cost guarantee work?

You pay no attorney fees unless we win. When we win, federal law requires the other side to pay our legal fees. You pay nothing out of pocket.

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