Credit Repair Scams are on the Rise

By: Salina Greene, Outreach Coordinator, NHS of Baltimore

As the economic recession continues, more people are looking into better options to reduce their expenses, and repair their credit. Unknowingly, consumers are becoming victims of several scams plaguing our city. Two of the most popular include: Credit repair and Bankruptcy advice programs. The number of illegal companies promising help with these issues is on the rise. Their main advertisement tools are signs posted on utility poles, lawns, and vacant houses; perhaps to target people in deteriorating neighborhoods.

An attorney for The Community Law Center (CLC) pulled an ad from a pole showing how prevalent these scams are around the city. An intern at his office researched the phone number and company listed on the ad. It was traced to a real-estate agent with major credit problems. When phone inquiries were made, all they ever got was a voicemail message. Apparently, the resident agent listed was the head agent’s sister; with legal problems of her own. He swore she had nothing to do with the company. Ironically, when questioned about his staff, he stated he had two partners and a silent partner. He only volunteered to identify the two partners by last name.

It is illegal nationwide for any non-lawyer to give legal advice and/or handle money client under the guise of legal council; up-front fees for credit repair is also illegal. Although they can charge fees for preparing petitions, this fee can only amount to the equivalent of the cost of a typist. The real-estate agent talked about above claims he provides his services as a way to serve the community. He agreed to meet a representative from CLC, but subsequently changed his mind and offered a follow-up call instead.

When looking for any credit repair or debt management program, please make sure you research the company thoroughly before you decide to commit to services. Scammers are on the rise. Don't be a victim.