The FTC has shut down Michigan-based Financial Education Services, a credit repair company that the agency says actually was a large pyramid scheme,

If approved by a federal judge in the Eastern District of Michigan, the settlement also will return $12 million to consumers harmed by the company, the FTC said. The company, which operated as early as 2015, was temporarily shut down when the FTC first filed suit against it in 2022.

The agency said that the company, which also did business as United Wealth Services, claimed to offer consumers the ability to remove negative information from credit scores and to increase their credit scores by hundreds of points. The company charged as much as $89 a month and required upfront payment. The company’s techniques rarely were effective and even resulted in credit scores dropping, the FTC said.

At the same time, the company promoted an investment opportunity to consumers – the opportunity to act as “FES” agents” – that the FTC characterized as an illegal pyramid scheme. 

The company placed a high priority on signing up consumers who used their services to act as “FES agents” by marketing FES services to other consumers, promising that they could earn tens of thousands of dollars if they signed up others to market the business. Those potential earnings were inflated.

The company provided FES agents with the necessary promotional and marketing materials, including social media advertising and scripts for English- and Spanish-speaking consumers, to more broadly market FES services, according to the FTC.