FTC Stops Credit Repair Scheme

The Federal Trade Commission reported that it has obtained an order halting a credit repair scheme that allegedly bilked consumers out of millions of dollars by falsely claiming they will remove negative information from credit reports, while also filing fake identity theft reports to explain negative items on customers' credit reports.

At the request of the FTC and the Department of Justice, a federal judge issued an injunction against Texas-based Turbo Solutions Inc., which does business as Alex Miller Credit Repair, and its owner Alex V. Miller. In a complaint filed by the Department of Justice on behalf of the FTC, the Commission alleges that Turbo Solutions and Miller operate a deceptive credit repair scheme that claims it can help repair consumers' credit through a "two-step process," but often fails to deliver on its promises.

The company claims it can remove negative information from consumers' histories through "advanced disputing" of negative items on a consumer's credit report and by adding "credit building products" to boost credit scores, which can help consumers obtain loans and other credit at lower rates. Before providing any services, however, the company illegally demands consumers pay a $1,500 fee up front, according to the complaint. Miller and his company have allegedly filed false identity theft reports—usually without customers' knowledge—through the FTC's identitytheft.gov website and deceptively claimed that negative items on consumers' credit reports were the result of identity theft.