CFPB Targets Credit Repair Company over Illegal Fees, Marketing
The CFPB has filed a federal lawsuit against a credit repair company over what the consumer protection agency called “a series of illegal advance fees” and misrepresentations of the cost and effectiveness of the company’s services. In the lawsuit against Van Nuys, Calif.-headquartered Prime Marketing Holdings LLC, the CFPB is seeking to halt the company’s allegedly illegal actions and obtain refunds for consumers who paid the improper fees, among other relief.
“Today we are taking action against Prime Marketing Holdings for luring consumers with misleading claims about its ability to repair credit files and then charging illegal fees,” said CFPB Director Richard Cordray, in a statement.
According to the CFPB complaint, Prime violated the Dodd-Frank Act’s prohibition on deceptive acts and practices in the marketing and promotion of its services, luring consumers with “misleading, unsubstantiated” claims that it could remove virtually any negative information from their credit reports and could boost credit scores by significant amounts. The company would then charge consumers a variety of illegal advance fees for its services, the complaint alleged. The company also allegedly violated the Telemarketing Sales Rule by charging illegal advance fees and making deceptive statements.