The Federal Trade Commission (FTC) recently sued Michael and Valerie Rando and their company The Credit Gamer for operating a bogus credit repair scheme.   Credit repair scams are very common as scammers take advantage of people with debt problems and promise to fix their credit and clear their credit reports of adverse information for up front fees.

Your credit report is one of the most important documents in your financial life.  The information in your credit report as maintained by the three major credit reporting agencies, Equifax, TransUnion and Experian is used to calculate your credit score.  This is used by financial institutions to evaluate your creditworthiness and can affect your ability to get a credit card, mortgage loan or a car loan.  It also can affect the rate that you will be charged on such loans.  In addition, your credit score is used in many states by companies in making hiring decisions and landlords consider credit scores when determining whether or not to rent an apartment or home to someone.

In its lawsuit the FTC alleges  the Randos and their company illegally charged consumers thousands of dollars for worthless and illegal credit repair services including filing false identity theft reports. The Randos also charged their customers upfront fees of thousands of dollars for their credit repair services which violates the Credit Repair Organizations Act (CROA),  At the FTC’s request the Florida Federal District Court issued a temporary restraining order halting their operation and freezing their assets.

TIPS

Don’t fall prey to scammers operating phony credit repair companies and never pay an upfront fee to one of these companies.  Advance fees for credit repair companies that operate for profit are banned by the Credit Repair Organizations Act.

Negative information on your credit report remains on your credit report for seven years and bankruptcies for ten years.  Anyone who tells you otherwise is just trying to scam you.  Many of the scam credit repair companies use illegal tactics such as applying for a federal employer ID to use as your Social Security number when applying for credit.  This is illegal.

If you need real credit counseling you can go to this section of the Department of Justice’s website where it lists agencies approved to assist consumers with debt problems. https://www.justice.gov/ust/list-credit-counseling-agencies-approved-pursuant-11-usc-111    You also may consider contacting companies that are affiliated with the National Foundation for Credit Counseling at this link https://www.nfcc.org/

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