By Mike Hughlett
| With complaints rising nationwide against credit repair companies, the
City of Chicago said Friday that it has filed consumer fraud and
deceptive practice charges against nine such firms locally.
The city’s Department of Business Affairs and Consumer Protection
charged four companies with falsely promising they could erase
consumers’ debt from their credit reports. Those companies are: Mark
Anthony & Associates of Skokie; Allstates Credit Repair in Chicago;
Credit Rx in Glenview; and Nationwide Credit Clearing in Chicago.
Mark Anthony and Credit Rx didn’t return calls, but epresenatives of Nationwide Credit and Allstates denied they made such promises. “There’s no guarantees, no promises,” said Todd Stern, Nationwide’s president. “I always tell customers, if (a credit repair company) makes a promise, run away.”
Credit repair companies seek to help consumers erase inaccurate postings from their credit reports. But if the information on a credit report is “verifiable and accurate, there’s nothing they can do to erase it,” said Steve Bernas, president of the Better Business Bureau in Chicago. “They’re not magicians.”
Bernas said that complaints about credit repair companies increase in recessions as the number of consumers struggling with debt mushrooms. “We’re seeing this on a national level, not just in Chicago,” he said.
Steve Baker, director of the Federal Trade Commission’s Midwest region, said the agency has indeed seen a rise in complaints about credit repair companies. The FTC has taken legal action against about 100 such firms in the past seven years or so, he said.
Efrat Stein, a spokeswoman for the city’s consumer protection office, said that consumers can work directly with the three credit reporting agencies—Experian, Equifax and TransUnion—to remove any inaccurate information. “You can do it yourself, you don’t need to hire anyone,” she said.
The city also charged Mark Anthony, Credit Rx and Allstates with not being registered businesses with the state, as is required by law. And all three companies, as well as National Credit, were charged with demanding up-front fees.
Only a few highly-regulated professions can charge up-front fees for credit repair work, including banks, lawyers and mortgage broker—and any firm that charges such fees has to be bonded, according to the city. Stern, of Nationwide Credit, said his firm has been bonded for years.
The FTC’s Baker said that under federal law, credit repair companies can’t require payment unless they’ve performed a service—bond or no bond.
Five other Chicago-based credit repair companies were also charged by the city with demanding up-front fees: Pinnacle Consulting Group & Associates, Credit Cures, International Credit Clearing, Credit Utopia and Credit Builders of Illinois. All but Credit Builders were also charged with being unregistered businesses.
A spokeswoman for Credit Builders said the company was bonded. The other four companies didn’t return calls; wouldn’t comment on the record; or couldn’t be reached for comment.
All nine cases were filed in the Department of Administrative Hearings. The companies face maximum charges of up to $50,000 each and restitution.
Fraud – a word that goes hand in hand with Chicago
Credit repair companies and fraud go hand-in-hand…..Preying on the desparate.
Folks…. Here is how you “fix” your credit. Stop paying,negotiate a settlement after 6 months with buyer of your bad debt for 10 cents on the dollar. Apply for $500.00 backed visa card (lots out there) and begin rebuilding your credit within two years! No bankruptcy,No credit repair scams, No problems! Welcome to America…. You can negotiate anything,oh and if you get a speeding ticket or any other kind of ticket,just buy your way out. I have had 16 moving violations in the last ten years and have a pefect driving record,not one ticket shows up on my “good driver” 6 year lisc renewal!!!!!! Funny!!!!!
r they really going to be charged 50,000? Wow….
With all the problems Chicagoans face, it’s mind boggling that the city would attack credit repair companies, an industry that is overwhelmingly honest and ethical. Do you think Norma Reyes would have the courage, fortitude, honesty or political guts to go after Chicago based Trans Union Corporation for the pain and misery they have foisted on many of the good people of Chicago? Of course she wouldn’t. She’s just another lawyer, another Chicago politician. In this misguided effort the city of Chicago has aligned itself with the Better Business Bureau, a true well organized national scam. Your readers would appreciate some old fashioned reporting. When you unearth the real story the public will be better served. The well financed PR campaign to label all credit repair companies “scams” began over 20 years ago. It is funded and driven by the major credit reporting agencies and their confederates; it continues unabated to this day. Chicago has some of the best reporters in the country. There is a Pulitzer Prize waiting for the one who tells the true story of why the credit repair industry is the most regulated business in America and why the three major credit bureaus are allowed to run roughshod over American consumer credit with a failed data reporting system while facing little or no accountability from the government, nationally, statewide or locally. One only has to read “Zero Day Threat” by Byron Acohido and Jon Swartz to begin to understand the real tragedy foisted on the American public by Trans Union, Equifax and Experian.
Very informative article, I have saved it and showed to to some of my friends already.
The big banks and Wall Street took billions in bailout money from taxpayers and then turned it into huge profit. In an insider’s club report a veteran trader exposed the banks and showed why Wall Street never fights fair (and neither we should).
Bank insider — Now I could understand why we never could trust our broker..It is sure the big banks dont want us to see this.
Steer clear of anybody who claims they can fix your credit rating even though the derogatory information is accurate or has just been recorded not that long ago and is therefore not obsolete. They are just scammers looking for easy money. They offer services you can easily do by yourself.
The whole process begins with these companies asking for upfront charges before they begin to “repair” your credit score. If your credit reports have accurate information that are not too old or obsolete, then there’s nothing to repair; there isn’t anything these companies can actually do for you.
Besides, you can get a copy of your own credit reports from the three different credit bureaus, which is a lot less expensive than the fees these firms charge you. You can even get it for free if you get denied in a credit application.
You have to know what you need to repair and look for a company that doesn’t cheat and can do the services you require efficiently.
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Greetings, You write some good blogs. I check back here often to find out if you have kept up to date. I thought you may want to know, once I click your RSS feed it re-directs me to another website.