BOSTON -- Sen. Frederick Berry is taking on credit counselors who have been "fleecing" customers by taking their money but not paying down their debt.

Berry, D-Peabody, testified last week before a legislative committee considering his bill to establish a board of registration for credit card counselors.

The bill would require background checks, government audits and tight regulation of credit counseling agencies. It would set penalties for fraudulent and deceptive practices, and provide a list of approved agencies to consumers.

Berry noted that legitimate credit counseling agencies are supporting the bill. Mel Stiller, the president and CEO of the Consumer Credit Counseling Service of Southern New England, urged the committee to pass the bill.

"I very much appreciate that the Legislature will be doing something about the abuses that are taking place in this industry," Stiller said. "I cannot tell you how long overdue this is, and how much you will be helping Massachusetts consumers."

Berry learned of the problem from an investigative report on the TV news. There are no laws governing the agencies now. State law requires only that the agency be run by an attorney, be based in Massachusetts, and have not-for-profit status.

According to the report, three out of four agencies in Massachusetts are conducting business illegally.
"I have made it a top priority of mine to address consumer protection issues this session," Berry said.