WV Attorney General Settles With Garbage Pail JDB

Attorney General McGraw Settles with Debt Purchaser, Excalibur I, Resulting in $3 Million in Canceled Debt for 861 West Virginia Consumers

Attorney General Darrell McGraw recently entered into a settlement agreement with Excalibur I, LLC, a debt purchaser based in Lake Success, New York, that resulted in the cancellation of more than $3 million in debt allegedly owed by 861 West Virginia consumers. Excalibur also agreed to dismiss 119 collection lawsuits that it had filed against West Virginia consumers and to release any court judgments that had already been obtained.

Attorney General McGraw’s Consumer Protection Division commenced an investigation of Excalibur last year after learning that Excalibur was collecting debts and filing lawsuits against West Virginia consumers without a collection agency license. Excalibur agreed to obtain a license before collecting debts in the future, to close the accounts of all consumers it had contacted with a zero balance, and to refund $27,611.00 of payments that it had collected from West Virginia consumers.

Attorney General McGraw stated, “The predatory lending practices of certain unscrupulous companies in the financial services industry has spawned a new industry - the debt purchasing industry. This new industry buys defaulted consumer accounts for pennies on the dollar and then aggressively attempts to collect the debt, which often includes the filing of a lawsuit. In many instances, debt purchasers pursue the wrong consumers and rarely have in their possession documents proving that the accounts are owed at all. I commend Excalibur for entering into this agreement with our office that will afford additional protections to consumers in the future.”

Any persons wishing to file a complaint about a consumer matter or to alert the Attorney General about unfair or deceptive practices may do so by calling the Consumer Protection Hot Line, 1-800-368-8808, or by obtaining a complaint form from the consumer web page at www.wvago.gov.

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Apex Credit Services, LLC Exposes FICO Lie

In September of 2007, FICO 08′ was to take effect with one credit reporting agency.  It didn’t happen.  Why?  Because it was and is illegal under the ECOA.

Please read our blog below for more information and why authorized user accounts are still effective.

Apex Credit Services, LLC Number Five CSO

Apex Credit Services, LLC Rated No: 5 in the U.S.

Apex Credit Services, LLC is rated number five amongst credit service organizations in the U.S.  See http://www.the-top-tens.com/lists/best-credit-report-repair-services.asp

Below are a few of the reviews:

“What I like about them is that the hit everything on the reports at once. Some other companies only dispute a few items in order to stretch everything out and in turn, take more money. Apex pinpoints things that are actually inaccurate so that what they don’t remove can be referred to a consumer attorney. They make the referrals for you and provide the attorney’s the evidence. This is because they actually do “written” requests rather than boilerplate forms or even worse, electronic disputes. In addition, they also communicate with all the debt collectors. Because they’ve actually litigated against some, they’re fairly successful through their contacts.

They take a little longer by doing all of this but, they explain that upfront. For what you get, $500.00 is well worth it. I don’t think any other CRO offers this type of service.“

“A little bit more money but, the results were astounding and the customer service was excellent. One gentlemen answered every conceivable concern I had and they raised my scores from 534 to a 726 in roughly 45 days. They are members of the BBB, licensed, and bonded and their staff seems entirely composed of attorneys. They are not the typical dispute mill I can tell you that.“

FICO 08′ Illegal

Fair Isaac (hereinafter, “FICO”) is the company which designs and implements the most universally accepted scoring model used today. It is commonly known as the FICO score. Today, the three major credit reporting agencies, Equifax, Experian, and Trans Union, utilize a FICO model which considers “authorized user” accounts. This model is referred to as a Beacon, Emperica, or a Classic score depending upon the credit reporting agency to which it is applied. With that said and no matter the name given, this model is in compliance with the Equal Credit Opportunity Act (hereinafter, the “ECOA”). The legislative intent and stated purpose of the ECOA was and remains in force to protect consumers from discriminatory and unethical practices in lending.

Nevertheless, FICO proposed last month a new scoring model which would completely disregard authorized user accounts. One credit reporting agency is allegedly set to begin using this model in September of 2007. Which one is still unknown. No credit reporting agency has issued a statement to this effect. The other two credit reporting agencies are set to review the model at some point in 2008. Please allow us to re-emphasize the operative “review” insofar as they have not said whether they will implement the change.

Let us be clear, this proposed model is illegal pursuant to the ECOA. One can review the following pertinent provision of the aforementioned Act and find this to be true:

(6) Credit history. To the extent that a creditor considers credit history in evaluating the creditworthiness of similarly qualified applicants for a similar type and amount of credit, in evaluating an applicant’s creditworthiness a creditor shall consider:

(i) The credit history, when available, of accounts designated as accounts that the applicant and the applicant’s spouse are permitted to use . . .

As anyone can discern, the law clearly states that “any” account which an applicant is permitted to use must be considered. This certainly envelopes authorized user accounts. With that in mind, it is only reasonable to forecast a windfall of class litigation that very well may affect Fair Isaac’s, the “test” credit reporting agency, and anyone who uses that method bottom lines. This is why only one credit reporting agency is set to implement the changed model in September. The other two are going to sit back and wait for the fallout.

This new model is projected to adversely affect 41 million Americans with respect to their credit scores. The reasons given for the so-called need for this change are many but, they are in essence a call for relief from the mortgage industry. After the sub-prime mortgage industry fell through the bottom, the aforesaid industry needed an explanation for their shareholders. Rather than admit to the truth which was that they were approving applicants with 520 mid-scores at 100% financing and nearly at 60% DTI, they blamed a small niche of consumers who knew how to operate shrewdly under the FICO model to increase their scores legally.

Presuming that the test credit reporting agency proceeds as planned and fails to see any temporary restraining orders or declaratory actions, the new model would have virtually no effect on consumers. This is because most mortgage and automobile lenders, even some credit card issuers, rely on the middle of the three scores. Consumers will continue to reap the benefit of authorized user accounts on two reporting agencies as described above. Again, the other two credit reporting agencies have only said that they intend to review the new FICO 08’ at some point in 2008. They have not said they will use and we are cautiously optimistic that they will follow the ECOA and decline to do so.

With all this said and assuming arguendo that all three credit reporting agencies enact the change; it wouldn’t affect most consumers until sometime in 2008 “if” they apply the change in a retroactive nature. This has not been made clear. In all honesty, we at Apex Credit Services, LLC cannot envision FICO 08’ moving forward as proposed in light of its illegality and as such, we will continue to offer our account tradelines in the spirit of the ECOA.