A federal judge has issued a Temporary Restraining Order blocking the operation of a network of 16 related companies and their principals that operated a credit repair business.

At the request of the FTC, Judge Steven Logan of the U.S. District Court for the District of Arizona has blocked Credit Glory from conducting business.

The FTC’s complaint alleges that since 2016, Credit Glory and its five principals, Alexander Brola, Liam Emery, Marko Petkovic, Joshua Curtis and David Naylor, “made false and misleading promises about their credit repair services, impersonated debt collection companies and creditors, collected illegal upfront fees and engaged in unlawful subscription enrollment practices.”

The commission contends that the operation scammed consumers out of nearly $200 million through unlawful up-front and recurring charges.

“Using paid Google search ads to target and deceive vulnerable consumers, including military servicemembers, through falsely promising to improve their credit is egregious behavior that will not be tolerated by the FTC,” said Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection.

The FTC alleges the defendants:

Made false promises about credit repair services: Defendants used Google search ads to induce consumers looking for information about debts owed to debt collection entities or creditors into contacting the defendants instead. In these search ads and on their websites, the defendants claimed that their credit repair services would substantially improve consumers’ credit scores by promising to remove negative items from credit reports. In particular, the FTC alleges that the defendants used paid search advertising to, in some instances, specifically target military servicemembers owing debts to military-related creditors, promising to improve their credit by disputing those debts.

Impersonated debt collection entities and creditors: “In numerous instances, when consumers contacted the defendants’ telemarketers, their telemarketers tricked consumers into believing they were talking with legitimate debt collection entities or creditors and claimed that their credit repair services will substantially improve consumers’ credit scores,” the FTC alleged. “Instead, the defendants disputed legitimate debts and, in some instances, filed false identity theft reports on Identitytheft.gov without consumers’ knowledge in an attempt to improve their credit. But neither action improved consumers’ credit scores.”

Illegally charged upfront fees: The defendants illegally required consumers to pay advance fees to enroll in their credit repair services. “The operation’s telemarketers typically stated that they needed to charge consumers a dollar, sometimes claiming it was needed to verify consumers’ identities or to review consumers’ credit reports,” the FTC said. The network also required an additional upfront fee, typically hundreds of dollars, before providing services.

Engaged in unlawful enrollment practices: The defendants charged consumers using a negative option and failed to clearly disclose recurring fees consumers would incur if they did not cancel. The defendants’ telemarketers often promised consumers they would only be charged for a few months, but consumers have reported that they incurred charges indefinitely or until they affirmatively canceled. The defendants routinely denied refund requests.

The FTC contends that the defendants violated the FTC Act, the Credit Repair Organizations Act, the Telemarketing Sales Rule, the Gramm-Leach-Bliley Act, the Restore Online Shoppers’ Confidence Act and the Electronic Fund Transfer Act.

The defendants in this case are: Credit Glory LLC (separately incorporated in three different states), Credit Glory Inc., Credit Sage LLC, Joy Credit Software LLC, Clerk Credit Systems LLC, Clerk Credit Software LLC, Standard Scores LLC, Collection Payments LLC, Collections Dispute LLC, Collections Expert LLC, Collections Support LLC, Credit Cop LLC, Dispute Collection LLC, Glorious Credit LLC, and Joyful Credit LLC—as well as Brola, Emery, Petkovic, Curtis and Naylor.