On May 2, the Consumer Financial Protection Bureau (CFPB) filed suit in the District of Utah against defendants operating two of the largest credit repair companies in the country, alleging that the companies engaged in deceptive acts and practices in violation of the Consumer Financial Protection Act (CFPA) and Telemarketing Sales Rule (TSR).
The CFPB alleges that the defendants improperly requested and received upfront fees for their telemarketed credit repair services. The TSR permits companies to charge fees for telemarketed credit repair services only after they have provided consumers with documentation that the promised results were actually achieved.
The CFPB also alleges that the defendants made deceptive representations in their marketing, either directly or through affiliates. The Bureau further alleges that the defendants expressly or impliedly represented that certain services were available through affiliates when they were in fact not available and guaranteed that consumers would obtain the advertised results.
The CFPB seeks injunctive and monetary relief.