Beware of debt relief scams that offer 'pie-in-the-sky promises'

For anyone facing spiralling debt and a falling credit rating, a debt relief consultant's picture-perfect solution could bring a glimmer of hope. But experts say if their promises seem too good to be true, they probably are.

"Anyone who makes a promise that they can eliminate your debt or boost your credit score is making pie-in-the-sky promises because it's just not a possibility to do it," said Brandon Smith, a licensed insolvency trustee with Ira Smith Trustee & Receiver Inc. in Vaughan, Ont.

Smith, who has been in the business for almost two decades, said some debt relief consultants are misleading financially strained consumers with rosy pitches about debt relief programs and charging them for services they aren't not qualified to carry out. 

The Office of the Superintendent of Bankruptcy (OSB), a federal agency which administers the Bankruptcy and Insolvency Act, issued a consumer alert last month for debt relief scams targeting indebted consumers.