REASONS FOR SETTLEMENT

   This statement accompanies the Consent Order executed by defendant
   National Financial Systems, Inc., in settlement of an action brought
   to recover penalties and equitable relief from defendant for engaging
   in acts or practices in violation of the Fair Debt Collection
   Practices Act, 15 U.S.C. § 1692 et seq.

   Pursuant to Section 5(m)(3) of the Federal Trade Commission Act, as
   amended (15 U.S.C. 45(m)(3)), the Commission hereby sets forth its
   reasons for settlement by entry of a Consent Order and injunction:

   On the basis of the allegations contained in the attached Complaint
   and the financial documents submitted by defendant, which show
   defendant's inability to pay a larger civil penalty, the Commission
   believes that the payment of a $20,000 civil penalty by defendant
   constitutes an appropriate amount on which to base settlement. To
   protect the integrity of the settlement, which is based on financial
   disclosures made by defendant, upon proof that defendant materially
   misrepresented its financial condition, a civil penalty of $100,000
   will be imposed, less all prior civil penalty payments made by
   defendant. The civil penalty should ensure compliance with the law by
   defendant and others who may be in violation. Further, the provisions
   enjoining defendant from violating the Fair Debt Collection Practices
   Act constitute effective means to assure defendant's future compliance
   with the law. Additionally, with the entry of such a Consent Order,
   the time and expense of litigation will be avoided.

   For the foregoing reasons, the Commission believes that the settlement
   by entry of the attached Consent Order with National Financial
   Systems, Inc., is justified and well within the public interest.

                        UNITED STATES DISTRICT COURT
                    FOR THE EASTERN DISTRICT OF NEW YORK

                    UNITED STATES OF AMERICA, Plaintiff,
                                     v.
    NATIONAL FINANCIAL SYSTEMS, INC., a New York corporation, Defendant.

                             Civil Action No.

        COMPLAINT FOR CIVIL PENALTIES, INJUNCTIVE, AND OTHER RELIEF

   Plaintiff, the United States of America, acting upon notification and
   authorization to the Attorney General by the Federal Trade Commission
   ("Commission"), for its Complaint alleges that:

   1. Plaintiff brings this action under Sections 5(m)(1)(A), 9, 13(b),
   and 16(a) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C.
   §§ 45(m)(1)(A), 49, 53(b), and 56(a) and Section 814 of the Fair Debt
   Collection Practices Act ("FDCP Act"), 15 U.S.C. § 16921, to obtain
   monetary civil penalties and injunctive or other relief for
   defendant's violations of the FDCP Act.

                          JURISDICTION AND VENUE

   2. This Court has jurisdiction over the action pursuant to 28 U.S.C.
   §§ 1331, 1337(a), 1345, and 1355, and under 15 U.S.C. §§ 45(m)(1)(A),
   49, 53(b), 56(a) and 16921.

   3. Venue in the Eastern District of New York is proper under 15 U.S.C.
   § 53(b) and under 28 U.S.C. §§ 1391(b) - (c) and § 1395(a).

                                 DEFENDANT

   4. Defendant National Financial Systems, Inc. is a New York
   corporation with an office and place of business located within the
   Eastern District of New York at 972 Brush Hollow Road, Westbury, New
   York 11590-1707, as well as an office and place of business located at
   8895 N. Military Trail, Suite 100C, Palm Beach Gardens, Florida 33410.
   At all times relevant to this Complaint, defendant has transacted
   business in the Eastern District of New York and at other locations
   throughout the United States.

   5. Defendant is a debt collector as "debt collector" is defined in
   Section 803(6) of the FDCP Act, 15 U.S.C. § 1692(a)(6).

   6. The term "consumer" as used in this Complaint means any natural
   person obligated or allegedly obligated to pay any debt, as "debt" is
   defined in Section 803(5) of the FDCP Act, 15 U.S.C. § 1692a(5).

                        UNITED STATES DISTRICT COURT
                    FOR THE EASTERN DISTRICT OF NEW YORK

                    UNITED STATES OF AMERICA, Plaintiff,
                                     v.
    NATIONAL FINANCIAL SYSTEMS, INC., a New York corporation, Defendant.

                              Civil Action No.

                               CONSENT ORDER

   WHEREAS: Plaintiff, the United States of America, has commenced this
   action by filing the Complaint herein; defendant has waived service of
   the Summons and Complaint; the parties have been represented by the
   attorneys whose names appear hereafter; and the parties have agreed to
   settlement of this action upon the following terms and conditions,
   without adjudication of any issue of fact or law and without defendant
   admitting liability for any of the matters alleged in the Complaint;

   THEREFORE, on the joint motion of plaintiff and defendant, it is
   hereby ORDERED, ADJUDGED, and DECREED as follows:

   1. This Court has jurisdiction of the subject matter and of the
   parties.

   2. The Complaint states a claim upon which relief may be granted
   against defendant under Sections 5(a)(1), 5(m)(1)(A), 9, 13(b), and
   16(a) of the Federal Trade Commission Act, 15 U.S.C. §§ 45(a)(1),
   45(m)(1)(A), 49, 53(b), and 56(a), and Section 814 of the Fair Debt
   Collection Practices Act ("FDCP Act"), 15 U.S.C. § 16921.

   3. For purposes of this Consent Order, the definitions set forth in
   the FDCP Act, 15 U.S.C. § 1692, shall apply.

                               CIVIL PENALTY

   4. Defendant and its successors and assigns shall pay to plaintiff a
   civil penalty, pursuant to Section 5(m)(1)(A) of the Federal Trade
   Commission Act, 15 U.S.C. § 45(m)(1)(A), in the amount of $20,000, to
   be held in an escrow account administered by Ronald D. Jacobs, Esq.,
   attorney for defendant.

   5. Defendant shall make the $20,000 payment required by Paragraph 4
   within ten (10) days of the date of entry of this Consent Order by
   certified or cashier's check made payable to the Treasurer of the
   United States and delivered to the Office of Consumer Litigation,
   Civil Division, U.S. Department of Justice, Washington, D.C. 20530.