The Better Business Bureau (BBB) once rated debt settlement companies the same way it rates other industries. At that time, Freedom Debt Relief was listed in good standing with the BBB and had a favorable rating.

In 2008, the BBB adopted a policy that it will not give any debt settlement company a favorable rating. This is due to the fact that the industry currently lacks uniform regulation, and therefore it is difficult to assess debt settlement firms according to objective standards. The other issue cited by the BBB is that for debt settlement/resolution to work a consumer must be in a default status with creditors. If an account is in default, creditors are more willing to negotiate. A consumer in default means the consumer is in breach of contract with their creditor. The BBB looks unfavorably at this aspect of debt settlement/resolution programs. However, by the same logic, the BBB should give negative ratings to all attorneys who practice bankruptcy or family law, because both consult with their clients about breaching contracts with creditors and others.

In regards to the settlement industry and the BBB’s stance, the president of The Association of Settlement Companies (TASC), Chris Kesterson, has this to say: "The BBB position apparently is that the business model of debt settlement is indefensible and that no set of standards are acceptable despite the fact that a number of state regulators and legislators recognize and license the practice while others are working with the industry to come up with standards. TASC ardently disagrees with the BBB's rejection of its standards and requests the BBB review its stance on the rating system for debt settlement companies" (see full article here).

Inconsistencies and other concerns surrounding the BBB’s rating methods are addressed in-depth at Web site BBB Roundup and have been the subject of several recent articles in papers such as the Los Angeles Times. Many of these sites and articles point to the troubling pattern that some say amounts to a "pay-to-play" policy.

For example, Google, which chose not to buy into BBB membership, is rated "F" by the BBB. On the other hand, Yahoo does purchase BBB membership, and is rated "A." Both companies have their supporters and detractors, but industry experts and analysts find it difficult to understand how the BBB could say that Google deserves an "F" in relation to Yahoo's "A."

Similarly, Starbucks Coffee chose not to purchase BBB membership and now finds themselves with an "F" rating, despite being famously dedicated to excellent customer service and business practices.

BBB is not an arm of the federal or state governments. The BBB is a private organization that supports itself by collecting membership fees from the members it rates, and therefore it would be wise for consumers to take into account a business's membership or non-membership when considering a business's BBB rating. See the Wikipedia’s Better Business Bureau Criticisms section for more on the BBB's business ratings.