Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: Proposed legislation targets fraudulent credit repair organizations, (Mar 24, 2026)

By Nora Macaluso

Several financial associations backed a bipartisan proposal to crack down on organizations that falsely claim they can repair consumers’ credit.

Senators Chris Coons (D-Del.) and Lisa Murkowski (R-Alaska) introduced a bill designed to crack down on fraudulent organizations that offer to repair consumers’ credit but in fact charge high fees without doing anything to improve credit scores. The Ending Scam Credit Repair Act would amend the Credit Repair Organizations Act by enacting additional consumer protections against harmful practices within the credit repair organization industry. Representatives Sarah McBride (D-Del.) and Young Kim (R-Calif.) introduced a companion bill in the House.

“Improving a low credit score is hard enough without having to navigate predatory companies seeking to lie to you and rip you off,” Coons said in a press release announcing the legislative action. The bill “would protect Americans trying to restore their financial foundation while making it easier for honest businesses to succeed,” he added. House lawmakers said they are responding to “widespread abuse” in the industry. “The credit repair industry is full of many bad actors” who take advantage of people with low credit scores, according to McBride.

Asking for payment before providing services or guarantees is “a common warning sign of a scam,” the lawmakers said. The bill would require credit repair organizations to provide documentation from a consumer reporting agency showing that the effort to repair credit has been successful. The bill would also require credit repair organizations to disclose that they do not provide any service that a consumer could not do themselves for free.

The National Consumer Law Center, American Financial Services Association, National Association of Consumer Bankruptcy Attorneys, American Bankers Association, National Association of Consumer Advocates, Consumer Bankers Association, Delaware Community Legal Aid Society, the Delaware Community Reinvestment Action Council, American Fintech Council, Consumer Action, and AARP all endorse the legislation, the press release noted.

“Banks help customers build credit every day through transparent products, financial education and long-term support, and this important legislation reinforces those responsible pathways by targeting deceptive credit repair schemes,” said Kirsten Sutton, executive vice president of congressional relations and legislative affairs at the ABA.

Michael Grimes, vice president of congressional affairs at AFSA, said credit repair scams “increasingly harm consumers by charging hundreds of dollars with no positive results.”

“This bipartisan effort will prohibit credit repair organizations from jamming financial institutions with duplicate requests and prevent these entities from taking advantage of consumers who are seeking better financial footing,” Grimes said.

AARP said the legislation could benefit its members. “Unfortunately, older Americans who have errors or negative marks on their credit report are often locked out of access to credit as they try to address these issues on their credit reports,” the association said. “Making matters worse, credit repair organizations (CROs) may claim to help them erase or fix items on people’s credit reports but instead exploit customers with the promise of a quick credit fix.”

The Fintech Council released a statement strongly supporting the legislation. In a separate letter to Coons and Murkowski, the council’s chief policy officer, Ian P. Moloney, said “the credit repair industry has long been plagued by organizations that exploit legal loopholes and harmful practices to deceive consumers, particularly those with low credit scores, by charging large upfront fees based on false promises of debt reduction.” Maloney added that “by eliminating the loopholes that have allowed predatory credit repair practices to flourish, the Act will contribute to a more transparent and fair financial system.”

Companies: AARP; American Bankers Association; American Financial Services Association; American Fintech Council; Consumer Action; Consumer Bankers Association; Delaware Community Legal Aid Society; Delaware Community Reinvestment Action Council; National Association of Consumer Bankruptcy Attorneys; National Association of Consumer Advocates; National Consumer Law Center

News: ConsumerProtection