CFPB Sued Credit Repair Company for Illegal Advance Fees

10/12/17 – In August, the Consumer Financial Protection Bureau (CFPB) proposed a final judgment in court that would resolve a lawsuit against a credit repair company for illegal credit repair practices.

The CFPB’s lawsuit alleged that the company charged illegal advance fees and misled consumers about the cost and effectiveness of its services and the nature of its money-back guarantee.

The credit repair company is incorporated in Delaware with an office in Van Nuys, Calif. In the CFPB’s lawsuit filed in September 2016, the CFPB alleged that the company made misleading and unsubstantiated statements about its ability to improve consumers’ credit scores by removing negative information from their credit reports. The company also, according to the CFPB, misrepresented and failed to disclose the limitations of its money-back guarantee. The Bureau alleged that these practices violated the Dodd-Frank Wall Street Reform and Consumer Protection Act and the Telemarketing Sales Rule. Specifically, the CFPB alleged that the company:

The proposed order would permanently ban the company from doing business within the credit repair industry and require a $150,000 civil money penalty.

CFPB Press Release; Complaint; Proposed Order.

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