Nationwide Credit Services agrees to stop making false claims, says FTC

FTC building - Nationwide Credit Services agrees to stop making false claimsNationwide Credit Services has agreed to stop making false claims and charging up-front fees under a settlement with the Federal Trade Commission.

The settlement is part of "Operation Clean Sweep," an ongoing crackdown on scams targeting financially strapped consumers. Most involve taking hundreds of dollars in fees to purportedly remove negative information from consumers' credit reports.

According to the complaint, James R. Dooley and his company, Nationwide Credit Services, Inc., lied to consumers, claiming bankruptcies, judgments, slow pay history, repossessions, and collection accounts could be "legally erased" from their credit reports.

The defendants charged customers up to $150 in advance and debited a monthly fee from some of their bank accounts. The defendants rarely, if ever, delivered the promised results, and in many instances took consumers' money without providing any services. Consumers often found their cancellation requests ignored, and refund requests were almost always denied, the FTC said.

The settlement order:
  • Bars the defendants from making false claims about any good or service, such as the ability to improve a consumer's creditworthiness or remove negative information from their reports.
  • Prohibits them from charging money up-front for credit repair services, and from collecting payments from consumers who purchased their services before October 20, 2008, when the court froze the defendants' assets.
  • Bans the defendants from disclosing or benefiting from customer information, and from failing to properly dispose of customer information.
The settlement order, filed in the U.S. District Court for the Middle District of Florida, also imposed a fine of more than $1.3 million. That judgment will be suspended once the defendants surrendered funds frozen by the court. The full $1.3 million will be due immediately if the defendants are found to have lied about their financial condition.
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