Recently, the U.S. District Court for the District of Massachusetts granted summary judgment in favor of the CFPB and the Massachusetts AG, against defendant credit repair company and its owner. As previously covered by InfoBytes, the CFPB and Massachusetts AG filed a lawsuit in 2020 against defendants for allegedly engaging in deceptive and abusive telemarketing acts or practices in violation of the Telemarketing Sales Rule (TSR), the CFPA, and Massachusetts consumer protection laws by purporting that their credit-repair services could help consumers improve their credit scores and fix “unlimited” amounts of negative items from consumers’ credit reports to increase enrollment.

The court found that the defendants violated the TSR’s advance-fee provision because it offers credit-repair services without specifying an end date for performance and it charges consumers before delivering the results promised. Because defendants violated the TSR, the court held this constituted an unfair, deceptive, or abusive act in violation of the CFPA. The court additionally found that defendants violated Massachusetts state laws, Chapter 93A and the MA-CSO, that prohibit unfair and deceptive acts or practices. As a result, defendants must pay $31.7 million in fees sand $9.6 million each in civil money penalties. The court also granted the CFPB and Massachusetts AG’s request for injunctive relief.