Attorney Generals News Release

August 18, 1995

California credit-repair business looking to profit off financial woes of Springfieldians, Nixon charges

Jefferson City, Mo. — Attorney General Jay Nixon today filed suit against a California credit repair business that has been advertising in Springfield. Nixon obtained a temporary restraining order today in Greene County Circuit Court against attorney Walter D. Channels and paralegal James Horton, who do business as The Law Center, out of Santa Ana and Covina, Calif.

Nixon alleges that representatives of The Law Center promised Springfieldians that their business would be able to remove bankruptcy, chargeoffs and late payments from credit histories in exchange for an advance fee of $1,030. Nixon said there are no quick or easy fixes for bad credit, and only time will repair bad credit history.

“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 ratings, regardless of their legitimacy, usually are nothing more than ways to take someone's money. We have taken action against several fraudulent credit repair businesses in the Springfield area so people won't lose their money thinking their bad credit history instantly will be gone.”

Channels and Horton also have not registered with the Missouri Division of Finance or obtained a surety bond as required by state law, Nixon charged. The suit seeks civil penalties against The Law Center and restitution for any Missourians who were victims to their actions.

A brochure from Nixon's office entitled “Credit Repair Scams” offers information to consumers on how to spot credit repair scams and how to control credit. The brochure can be obtained by contacting the Attorney General's Consumer Protection Hotline at 1-800-392-8222. Consumers also can use the hotline to report credit-repair fraud.

Last May, Nixon sued two Springfield-based credit repair companies, Cal Consumer Services and Personal Financial Services. Last month, the owner of Cal Consumer Services agreed to pay restitution to his customers.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818