Well it has happened again. Yet another credit repair organization has fallen under the sledgehammer known as the Federal Trade Commission and you know what, rightfully so, idiot scammers.
Wishful consumers desperate for a quick fix to hide accurate but negative items on their credit report are easy prey for credit repair scammers looking to make a quick illegal buck.
I am no longer surprised by the number of people who continue to sell credit repair services to consumers and think it is okay or they can get away with it. New people spring up every day even years after the Credit Repair Organizations Act passed. Here is but the latest.
From the Federal Trade Commission:
A credit repair company that falsely claimed it would help boost consumers’ credit ratings will settle Federal Trade Commission charges filed last year as part of “Operation Clean Sweep,” a federal-state crackdown on credit repair scams.
The FTC charged the Chicago-based defendants with falsely promising to remove negative information from consumers’ credit reports, even if it was accurate and current, in violation of the FTC Act and the Credit Repair Organizations Act. They also allegedly violated federal law by requiring payment before any service was provided to consumers. According to the FTC’s complaint, the defendants’ advertising stated, “We would never charge a large fee up front, or make you wait a long period of time to refund your money if we do not get results. You WILL see results in 60 days, or your money will be refunded in full . . . .” They charged $495 per person and $665 for a couple and required $219 or $269, respectively, in advance.
The settlement order bars the defendants from further violations and from misrepresenting:
- They can improve consumers’ credit reports by permanently removing negative information, even when it’s accurate and current;
- They can otherwise improve a consumer’s credit report or ability to obtain credit;
- The full cost of their services and any restrictions on consumers’ use of those services;
- Their refund or cancellation policy; or
- The benefits of using their goods or services.
The order imposes a $226,793.90 judgment that will be suspended once they pay $20,000. The full judgment will become due immediately if the defendants are found to have misrepresented their financial condition. The order prohibits the defendants from collecting any payments from consumers who purchased their services before October 23, 2008, when the court halted their business practices and froze their assets. The order further bars them from
disclosing or benefitting from customer information, and failing to properly dispose of customer
The defendants are Advantage Credit Repair LLC and Mark D. Solomon. The Commission vote to authorize staff to file the stipulated final order was 4-0. The proposed order was filed in the U.S. District Court for the Northern District of Illinois, Eastern Division.
The Commission appreciates the assistance of the Better Business Bureau of Chicago & Northern Illinois in this case.
You can read the complaint and judgment here.