Defendants in FTC Credit Repair Scheme Case Agree to Settle Charges
The operators of a bogus credit repair scheme are banned from the credit repair business and subject to a wide array of other requirements under settlement terms with the Federal Trade Commission.
The settlements relate to an FTC complaint filed in June 2019[1] alleging that the defendants targeted consumers with false promises of substantially improving consumers’ credit scores by claiming to remove all negative items and “hard” credit inquiries (which can often change a consumer’s credit score) from consumers’ credit reports. In addition, the FTC alleged the defendants illegally charged upfront fees for their services and advised consumers to mislead credit bureaus and lenders, as well as threatening consumers with lawsuits when they complained or disputed charges.
“These companies promised to clean up people’s credit, but failed to deliver,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “If anyone says they can remove accurate and current information from your credit report, that’s probably a credit repair scam.”
Under the terms of the settlements, the defendants are permanently banned from operating or promoting any credit repair service. They also are prohibited from misleading consumers about financial services like credit offerings or debt relief and from further violations of the FTC’s regulations and rules, including the Telemarketing Sales Rule.
To resolve the FTC’s allegations that the defendants’ contracts with consumers had unlawful terms, the settlements also prohibit the defendants from using threats, intimidation, confessions of judgment, and other unfair practices to prevent consumers from exercising their rights to dispute charges.
The settlement[2] with defendants Douglas Filter; Marcio G. Andrade; Grand Teton Professionals, LLC; 99th Floor, LLC; Mait Management Inc.; Demand Dynamics LLC; Atomium Corps Inc. (a Wyoming company); Atomium Corps Inc. (a Wyoming company); and First Incorporation Services Inc. (a Wyoming company) includes a monetary judgment of $9,641,982, which is partially suspended due to an inability to pay. The defendants will be required to give the FTC the contents of a number of bank, investment, merchant, and cryptocurrency accounts.