Consumer Finance Insights
May 6, 2022

FTC Obtains Temporary Restraining Order Against Credit Repair Operation

On May 6, 2022, the Federal Trade Commission (FTC) announced that, at its request, the U.S. District Court for the Middle District of Florida had issued a temporary restraining order (TRO), effectively shutting down a credit repair operation.

In the FTC’s complaint, it alleged that the company charged consumers hundreds of dollars for credit repair services that had little to no value. Further, the FTC alleged the company advised consumers to put their COVID-19 governmental benefits toward the services that the company offered.  Among the purported services, the FTC alleged that the company encouraged consumers to take illegal actions, including filing false identity theft reports.  In addition to defrauding consumers, the FTC alleged that the company lied to credit reporting agencies concerning consumers’ credit report information. The FTC alleged that the credit repair operation’s deceptive tactics violated the FTC Act, the Credit Repair Organizations Act, the Business Opportunity Rule, the Telemarketing Sales Rule, and the Covid Consumer Protection Act.

​The TRO requires the company to temporarily cease the allegedly illegal activity and to make certain financial disclosures. It further places a temporary freeze on the company’s assets.

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