In recent years, the Federal Trade Commission (FTC) has taken action to sue several "so-called” debt management organizations. The FTC contends that these organizations deceived consumers, charged high fees and didn't offer the services they claimed to provide.

A reputable debt management credit counseling organization should employ licensed and trained credit counselors, who educate their customers on budgeting, saving money, debt management and consumer credit.

A Debt Management Plan is a system, where consumers who are overwhelmed by debt, seek the services of a debt management and credit counseling service. The consumer deposits money into an account, that is used by the DMP to pay off the consumer's medical bills, student loans, credit cards, etc.

If you are currently enrolled in a debt management plan, the FTC advises the following:

* Contact your creditors and let them know what you will be paying your bills through a debt management plan.

* Check your monthly statements to ensure that your bills are being paid on time.

* If you find that your bills are not being paid on time, call your creditors and arrange a payment schedule, immediately. Pay your bills on time.

If your

* Contact your bank and stop payment on any money going to the DMP.

* Contact your creditors and let them know that your DMP is out of business and that you will be responsible for paying your bills.

* Pay your bills directly to your creditors.

* Get a free copy of your government credit report. Check for any negative information. If you find any missed payments or late payments, contact your creditor and see, if they will remove the information.