FTC: Credit Repair Network Scammed Consumers Out Of Nearly $200 Million
By CU Today Staff —
WASHINGTON—A federal court has temporarily shut down a sprawling credit repair operation that the Federal Trade Commission alleges bilked consumers out of nearly $200 million through deceptive promises, illegal upfront charges and recurring fees.
The FTC said Credit Glory and a network of related companies falsely promised to improve consumers’ credit scores while in some cases posing as creditors and debt collectors.
According to the FTC, the operation, active since at least 2016, used paid Google search ads to reach consumers searching for information about debts and allegedly promised it could remove negative information from their credit reports. The agency said some ads specifically targeted military servicemembers who owed money to military-related creditors, including the Army & Air Force Exchange Service and USAA. Telemarketers sometimes led consumers to believe they were speaking directly with legitimate creditors or collection companies, the FTC alleged.
The FTC said the defendants disputed legitimate debts and, in some cases, filed false identity theft reports through IdentityTheft.gov without consumers’ knowledge. Consumers also allegedly were charged illegal advance fees—often beginning with a $1 charge purportedly for identity verification or a credit-report review, followed by upfront fees of hundreds of dollars. The agency said recurring charges were sometimes imposed without consumers’ informed consent and could continue indefinitely until consumers canceled.
“Using paid Google search ads to target and deceive vulnerable consumers, including military servicemembers, through falsely promising to improve their credit is egregious behavior that will not be tolerated by the FTC,” Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said.
The complaint names 16 related entities and five principals—Alexander Brola, Liam Emery, Marko Petkovic, Joshua Curtis and David Naylor—and alleges violations of the FTC Act, Credit Repair Organizations Act, Telemarketing Sales Rule, Gramm-Leach-Bliley Act, Restore Online Shoppers’ Confidence Act and Electronic Fund Transfer Act.
Originally reported by CU Today.