On June 21, the U.S. District Court for the District of Connecticut granted a temporary restraining order to the Federal Trade Commission to stop the operations of Grand Teton Professionals, a credit repair company. The FTC previously filed a complaint against Grand Teton and related entities, including its owners in their individual capacities – alleging that they operated an illegal credit repair scheme that charged improper upfront fees and falsely claimed to repair consumers’ credit. The complaint asserts violations of the FTC Act and several provisions of the Credit Repair Organizations Act, the Telemarketing Sales Rule, the Consumer Review Fairness Act, the Truth in Lending Act, and the Electronic Funds Transfer Act.

According to the FTC’s complaint, since at least 2014, the defendants, using such trade names as Deletion Experts, Inquiry Busters, and Top Tradelines, used deceptive websites, unsolicited emails, and text messages to target consumers with false promises of substantially improving consumers’ credit scores by claiming to remove all negative items and hard inquiries from their credit reports. Moreover, the defendants are alleged to have:

  • Falsely claimed to substantially improve consumers’ credit scores by promising to add consumers as “authorized users” to other individuals’ credit accounts;
  • Failed to provide the required disclosures with their credit repair services;
  • Improperly threatened consumers with legal action for violating purported anti-disparagement and anti-chargeback contract clauses; and
  • Engaged in electronic fund transfers from consumers’ bank accounts without obtaining proper authorization.

The FTC claims that the defendants, including its two owners, Douglas Filter and Marcio G. Andrade, illegally obtained at least $6.2 million from consumers. Under the terms of the temporary restraining order granted by the court, Grand Teton has temporarily ceased operations and the defendants’ assets are frozen.

Troutman Sanders will continue to monitor these FTC developments and provide any further updates as they are available.