Advantage Credit Repair LLC in Chicago and Mark D. Solomon, its president and owner, agreed to settle Federal Trade Commission charges filed last year for falsely claiming the firm would improve consumers' credit ratings.

The settlement order imposes a $226,794 judgment that will be suspended once the defendants pay $20,000, the FTC said last week. The full judgment will be due immediately if it is found that the defendants misrepresented their financial condition.

The case is part of an FTC crackdown, started in 2008, on credit repair scams. In this case the agency said Advantage Credit promised to remove negative information from consumers' credit reports, even if it was accurate and current, in violation of the FTC Act and the Credit Repair Organizations Act.

The defendants also allegedly violated federal law by requiring payment before any service was provided to consumers. According to the FTC's complaint, the defendants' advertising stated: "We would never charge a large fee up front, or make you wait a long period of time to refund your money if we do not get results. You will see results in 60 days, or your money will be refunded in full." Consumers were charged $495 per person, which included an up-front fee of $219, and $665 for a couple, which included an up-front fee of $269.

The settlement bars the defendants from further violations and from claiming that they can improve consumers' credit reports by permanently removing negative information, even when it's accurate and current or that they can otherwise improve a consumer's credit report or ability to obtain credit. They are also barred from misrepresenting the full cost of their services and any restrictions on consumers' use of those services; their refund or cancellation policy; and the benefits of using their goods or services.

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