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Credit scores plummet when people fail to pay off their debts, making them very unattractive to potential lenders. (When credit scores go down, interest rates go up and obtaining a loan gets much harder.) Identity thieves can also do a significant amount of damage to a credit report. Fortunately, credit repair services can help credit-challenged people or victims of identity theft improve their credit profiles. But, according to an article published by the Indianapolis Star, the owner of a credit repair service used stolen Social Security numbers to improve his clients’ ability to make large purchases. (Like his clientele, this guy clearly bit off more than he could chew, and eventually got caught by authorities.)
According to the article, the credit repair service owner claimed that his business could help individuals who wouldn’t normally qualify for a loan purchase new vehicles and other high-priced items. His repair fee ranged from $2,000-$3,500 per customer. (His clients would have been better off putting that money towards paying off their debt.)
The credit repair business owner was assisted by a Californian co-conspirator, who provided stolen Social Security numbers (SSNs) and other illegally obtained documents. The business owner referred to the stolen SSNs as “credit profile numbers,” and matched them and other documents including utility bill payments and lease agreements to carry out his fraudulent scheme.
The 38-year-old credit repair service owner was sentenced to serve 92 months in prison and three subsequent years of supervised release. He also was ordered to pay $679,000 in restitution. (I bet he wishes he could claim someone else’s identity.)His 39-year-old accomplice was sentenced to 40 months in prison for her part in the scam.
This identity thief was definitely no Robin Hood. (Stealing the identities of people with good credit and selling them to those with bad credit was definitely not a charitable exercise.)Althoughhe may have originally intended to help those with poor credit to improve their situation, he ultimately took advantage of them, eventually causing more financial distress in the end. Nonetheless, consumers struggling with debt can learn something from this story – often the best way to deal with bad credit is to simply pay off your bills and only buy what you can afford.
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