CFPB to mail refund checks to more than 4 million CreditRepair.com and Lexington Law consumers
The Consumer Financial Protection Bureau said checks will begin going out in December 2024 to consumers harmed by its case against the credit repair brands.
The Consumer Financial Protection Bureau said it will begin mailing refund checks in December 2024 to more than 4 million consumers harmed by CreditRepair.com and Lexington Law.
The payments are part of a $2.7 billion enforcement action involving the firms and a redress distribution the CFPB said will be handled by JND Legal Administration. The agency said the checks are meant to return money collected in connection with telemarketed credit repair services and related consumer harm.
Why it matters
The CFPB said the distribution will reach consumers identified from company records, and that no claim form is needed. The bureau said eligible recipients should receive checks without taking extra steps.
The agency said the checks represent pro-rata shares based on fees paid, and that the amounts may not cover all fees. If money remains after the first round, the bureau said additional checks may go to consumers who cashed their initial payment.
Background
In its blog post, the CFPB said the companies violated federal telemarketing laws by collecting upfront fees for telemarketed credit repair services. The bureau also said it found bait-and-switch advertising.
As part of the enforcement action, the companies were ordered to pay $2.7 billion in consumer redress and civil penalties and were banned from telemarketing credit repair services for 10 years, according to the CFPB.
The bureau said JND Legal Administration will distribute $1.8 billion in civil penalty funds and consumer redress between Dec. 5, 2024, and Jan. 6, 2025. The CFPB said eligible consumers were identified from company records and do not need to file claims.
What officials said
The CFPB warned that bad actors may try to scam consumers by asking for sensitive information or money in exchange for funds from the distribution. It said valid checks can be cashed at a bank where the recipient has an account or, for people without a bank account, at any domestic Wells Fargo branch for no fee with identification.
The bureau also listed ways to request a reissue, including the website cfpb-lexlaw.org, the email info@cfpb-lexlaw.org, and the mailing address Lexington Law Matter c/o JND Legal Administration, P.O. Box 91015, Seattle, WA 98111. It said reissue runs are expected about once every two months beginning in mid-February 2025.
What happens next
The CFPB said consumers with questions should wait until after Jan. 6, 2025, because of the volume of checks being issued. It also provided a validation line for JND Legal Administration at 1-855-680-8991 and the CFPB’s customer service line at (855) 411-CFPB (2372).
The bureau said the payment is considered a refund of money paid to the defendants and is unlikely to be taxable.
Sources
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