PGX Holdings, better known to us as "fixer" firms Lexington Law and CreditRepair.com, is nearly ready to eat a consent judgment from the CFPB for $2.7 billion and a ten year ban on telemarketing, having fought the Bureau's lawsuit since May 2019.
From the press release:
Quote:
Lexington Law and CreditRepair.com are the largest credit repair brands in the country. The credit repair services are marketed and offered through a web of related entities in the Salt Lake City area, including PGX Holdings, Progrexion Marketing, and the John C. Heath, Attorney-at-Law PC law firm. During the time period relevant to the lawsuit, the companies operated nationwide and had more than 4 million customers who were subjected to telemarketing. In 2022, the defendants had combined annual revenues of approximately $388 million.
Marketing arm Progrexion's great gimmick was to snare credit repair customers through "Hotswap Partners", ostensibly offering credit-dependent services "such as rent-to-own housing contracts, mortgages, auto loans, or personal loans", per the 2019 Complaint. Partner call center agents were trained to convince the financially distressed that signing on with Lexington Law or CreditRepair was a pre-requisite to obtaining whatever deal they sought. Talk about "conflict of interest"! Agents transferred willing leads to the fixer, I guess while they were "hot". Quite often those Partners were cardboard shams, existing only to drive sales leads to Lexington. Maybe that's the "swap" part? Certainly sounds like "bait and switch", anyway.
This Spring the CFPB was granted partial summary judgment on the Telemarketing Sale Rule violations, the meat and potatoes of the Complaint. That tells us the CFPB team did their homework and boxed in PGX so tightly that they could offer no defense with straight faces. Whether any of that fat judgment will be paid remains in question. The press release explains:
Quote:
Following the district court's ruling, the companies filed for Chapter 11 bankruptcy protection. The companies represented that they had shut down about 80 percent of their business, including their call centers, and laid off about 900 employees in response to the court's ruling.
You can't fine us!
We quit! Let's see how long it takes (or took) those nine hundred gang members to find work in the same sector, if not with the same bosses by proxy under new branding.
There is more intersection with the interest of 800Notes readers than being veteran telefrauds. Lexington Law has a most irritating
long tradition of spamming and shilling this and many other complaint websites with dubious cheerleading testimonials. Once I kept a file with numerous examples socked away, some dating to 2007, now lost on a crippled hard drive. A few survive
in the number thread wilds, others were blanked by moderators or Admin.
Here's a snappy one-liner from three years ago:
"It is Lexington Law. I have an account with them, not a scam"Someone in May 2017 crowed:
"My credit was in the toilet at 580 I think. And now it's at 645. I've been using them for 5 months. The changes seem to take a couple of months to start,but when it started I was surprised!" This was shoehorned into a thread which made no mention of Lexington or any form of credit repair, a fairly common blunt force tactic.
The Lexington plan hinged on pelting creditors with dispute letters. The more you paid, the more mail traffic it bought. Said letters were all template jobs, signed with the names of customers and not the "fixer" company. Despite anything promised or implied in the sales patter, marketer Progrexion was churning out the paper, not attorneys from Lexington or Heath or even rookie paralegals. Across the credit repair industry, this shower of disputes is a typical gambit which does tend to improve credit scores, but only for fleeting weeks until the creditors and bureaus reject them as frivolous, which most buckshot disputes are. By the time "repair" customers begin to suspect the plan is a big flop, they've already sunk in a grand or more.
The CFPB complaint echoes this money drain, finding that PGX customers were first charged up to $15 for their own TransUnion credit reports. Then came the $100 upfront "work fee" upon enrollment. Subsequent monthly fees ranged from $79.95 to $129.95. In a household already straining to meet a tolerable living standard, that's cash flowing into a furnace which could have been spent directly on credit problems, not to mention unplanned medical bills, school supplies, and pasta salad.
Major
credit reports have long been offered annually for free, the same price charged to people who successfully haggle with creditors themselves. Collecting fees before starting the work is illegal in this sector for good reasons. The "fixers" need skin in the game; thus far none offer any above parasitic ambition. There's no magic or guru advice for frugal living which is worth burning all of next week's money on today's problem.
- - - - - - - -
CFPB Reaches Multibillion Dollar Settlement with Credit Repair Conglomerate - CFPB press release, yesterday
Reply to topic