The Attorney General of Illinois has sued Cambridge Credit Counseling, according to this article.
It seems the most significant impetus for the lawsuit is Cambridge's relationship with for-profits Brighton Credit and Brighton Debt. This is similar to the NCC situation we've been discussing in the comment areas, but not exactly the same. It seems Cambridge paid the for-profits to service the debt, rather than being paid by the for-profits to direct business their way.
Also at issue is the fee structure; Cambridge was charging a one-time startup fee that equaled the client's regular monthly payment, similar to Ameridebt. Illinois law limits startup fees to $50.
This may turn out to be big news; Cambridge is the heavy hitter in the industry; I'm guessing they have 50 to 100 thousand active clients (they claim 160,000). If other states pile on and start suing them, who knows what could happen.
Personally, I've never dealt with Cambridge. My only beef with them is that they don't have any third-party accountability. They're not COA accredited, and they don't seem to belong to any trade organizations. Unlike NFCC counselors who have a rigorous third-party counselor accreditation program, Cambridge has their own "Cambridge Credit Family of Companies Employee Certification Program," which, on paper, smells funny to me.
Cambridge is ISO:9000 accredited, but I'm not convinced that ISO:9000 is a good standard for credit counseling. I suppose that's debatable. At any rate, the Illinois AG isn't impressed.