FTC and Federal Court in California shut down FTC Credit Solutions

Published: Mar 27, 2015 13:11pm EDT
By Lance Rinker, Managing Editor for Konsume Politics

Please Note: This article was updated Mar 27, 2015 @ 01:11pm EDT

 

The Federal Trade Commission has proven in federal court that a company called “FTC Credit Solutions” has used a false affiliation with the Commission to take advantage of Spanish-speaking consumers seeking credit repair services.

In the 59-page case file, a federal court in California has halted the operations of First Time Credit Solutions, Corp., which also conducts business as “FTC Credit Solutions”, “1st Consumer Credit”, and “Doctor de Credito”. The owner/operator and Marketing Director of First Time Credit Solutions, Corp. is listed as Guillermo Leyes.

In the 21-page complaint filed with the court on March 16, the FTC alleges:

Defendants prey on Spanish-speaking consumers who seek to modify burdensome debts or to improve low credit scores. They falsely pose as affiliates or licensees of the federal government, namely the Federal Trade Commission, claiming that these credentials enable them to remove negative information from consumers' credit reports, eliminate debts, and guarantee consumers a credit score of 700 or higher within six months or less. Defendants are bilking consumers on a daily basis, charging each victim approximately $2,000 for their fraudulent services.

“Peddling lies under the name of the Federal Trade Commission to target consumers who are in difficult financial situations is appalling,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection, in a statement. “This scam used the promise of a fresh start to hurt consumers when they most needed help, so we are pleased the court has taken a first step to ending it for good.”

The FTC’s smoking gun, one of many it seemed, came from a radio advertisement hosted by defendant Guillermo Leyes. In those radio advertisements, Leyes falsely stated FTC Credit Solutions had a license from the FTC and that is how the company could guarantee any consumer a credit score of 700 or higher within four months.

An undercover FTC investigator also placed calls to the company posing as a consumer in need of credit repair services. Defendant Maria Bernal, an employee of the company, said that the company “works under the Federal Trade Commission, which is a law that was signed by the President in 2010.” She also falsely promised that the company could “delete” and “get [the investigator] a pardon” for $19,000 in debt.

Under the terms of the temporary restraining order granted by the court, the company has temporarily ceased operations and the defendants’ assets are frozen.

In a cached version of the FTC Credit Solutions website, as the site has gone offline since the temporary restraining order went in effect, the company lists multiple services and certifications which are false.

Services and certifications claimed include:

·  Services

·  FTC Certifications

An advertisement embedded on the original version of the website offers testimonials of the great service the company provides and targets Spanish-speaking consumers specifically.

In addition to unlawfully charging consumers fees in advance of providing the promised credit repair services, the FTC alleges the company sent major credit bureaus letters with false information on behalf of numerous consumers.

A complaint posted on Yelp from user “Cindy R.” said:

This is absolutely the worst company anyone can ever work for or do business with. The owner claims to be Christian. He is nothing but a thief.  He takes advantage of low income families that are looking to improve their credit.  By falsely sending letters to credit bureau stating identity theft and playing with the system.  He pays his employees salary so that he may over work them and less than minimum wage. Anyone who has even lasted at that company for more than a month is definitely getting some side advantages because I have never worked for or seen such horrible working conditions in an office setting.  Please be aware of this company.

The company describes itself as the best bad credit removal solutions company in Southern California and as being established in 1999.

The FTC states the company, along with the employees Leyes, Bernal, Jimena Perez and Fermin Campos, violated the FTC Act and Credit Repair Organizations Act (CROA) by making false promises about removing negative information from consumers’’ credit reports, making false promises about improving consumers’ credit scores and by misrepresenting their services.


 

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