Mo. Credit Repair Business Charged in Lawsuit

May 11, 2004

A credit repair business in St. Louis County that advertised it could “legally work to remove all negative credit information” and give consumers a high credit score broke Missouri consumer protection laws, Attorney General Jay Nixon said in a lawsuit.

Nixon is suing NuStar Enterprise and its owner Kevin G. McDaniel for reportedly making false promises to consumers who contracted with the business. NuStar, located at 12444 Lusher, also operated under the name New Start Credit Solutions.

“You can’t ‘repair’ or remove accurate, negative information on a credit report, and any business that claims it can is perpetrating a fraud,” Nixon said in St. Louis in announcing the lawsuit.

Nixon said NuStar promised consumers it could remove negative information and guaranteed to consumers that if negative information was not removed from their credit reports within 365 days, they would receive a 150 percent refund of their contract. At least 29 residents of the St. Louis area paid NuStar from $175 to $600 in advance for services that were not performed, but Nixon says there may be other victims who have not yet contacted his office.

The defendants also were not registered with the Missouri Division of Finance as a credit service organization and had not posted a surety bond, as required by the Missouri Credit Service Organizations Act, the lawsuit alleges.

“People who go to credit repair services usually are in dire financial straits and are susceptible to fraudulent businesses that can’t provide the services they offer,” Nixon said. “Promises to clear bad credit, regardless if the items are legitimate, are nothing more than ways to take someone’s money. There are no quick or easy fixes for bad credit, and only time will repair a negative — but accurate — credit history.”

The lawsuit asks the St. Louis County Circuit Court to issue preliminary and permanent injunctions against NuStar and McDaniel to prohibit them from further violations of Missouri consumer protection laws or the Credit Service Organizations Act. Nixon also wants the court to order the defendants to pay full restitution to customers and to pay the state civil penalties and the costs of bringing the lawsuit.

Nixon said consumers can remove outdated or inaccurate information from their credit reports on their own at no cost by contacting one of the three major credit bureaus:

Equifax: 800-685-1111
Experian: 888-397-3742
Trans Union: 800-916-8800

Consumers also are entitled to a free copy of their credit report if they applied for and were denied credit, insurance or employment within the last 60 days.

If the application was denied because of information supplied by a credit bureau, the company denying the application must provide the bureau’s name, address and phone number.

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