A Las Vegas man has been indicted in the first-ever criminal conte…

A Las Vegas man has been indicted in the first-ever criminal contempt prosecution related to a deceptive credit repair scam. Richard Murkey Sr., 57, who formerly resided in Chatsworth, was named in a nine-count indictment that alleges criminal contempt of court.

The indictment, which was returned by a federal grand jury on Tuesday afternoon, was announced today by United States Attorney Debra W. Yang and United States Assistant Attorney General Peter Keisler.

The indictment charges that Murkey used infomercials, newspaper advertisements and other means to lure consumers into purchasing credit repair services. The indictment also alleges that he made prohibited statements to lull consumers into purchasing his services, and then he caused false and misleading statements to be made to Trans Union about his customers’ credit histories. The indictment alleges that all of this activity violated a federal court order.

“Credit repair” generally involves an attempt to remove negative credit information from consumers’ credit reports. But, according to the Federal Trade Commission, individuals and firms that offer “credit repair” services cannot remove legitimate negative information and, where there are actual errors in credit reports, consumers have the legal right to have those corrected for free most of the time.

The FTC brought a civil case against Murkey in 1998 for misleading consumers in connection with credit repair. In November 1999, the United States District Court in Los Angeles issued an order finding that Murkey had systematically violated the law and banning him from offering credit repair services. The court also prohibited him from promising consumers more results than he could deliver, and barred him from misleading credit reporting companies about his clients’ credit histories.

The indictment charges that immediately after the court’s order was issued, Murkey continued to offer credit repair services through businesses such as “Credit Restoration Corporation of America, Inc.” In 2001, the FTC brought a civil contempt case against Murkey, and a District Judge in Los Angeles held Murkey in civil contempt. Nevertheless, the indictment alleges that Murkey returned to credit repair several months after the civil contempt finding, operating in a clandestine fashion and using the bank account of another person to operate his business.

“There is only so much that civil enforcement can do against scams like credit repair,” said Howard Beales, Director of the FTC’s Bureau of Consumer Protection. “We appreciate the Justice Department’s willingness to pursue the criminal sanctions that con artists so richly deserve.”

The indictment charges Murkey with criminal contempt for offering his credit repair services both before and after the court found him in civil contempt. One count alleges that Murkey unlawfully engaged in credit repair before the civil contempt finding, and another alleges that he unlawfully engaged in credit repair after that finding. Three counts in the indictment allege that, contrary to the court order, Murkey told consumers that he could substantially improve their credit reports by lawfully and permanently removing negative information from the reports, regardless of whether the information was accurate or obsolete. Four counts allege that Murkey violated the order by causing false and misleading statements to be sent to Trans Union in an effort to have negative information removed from customers’ credit reports.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

A warrant has been issued for Murkey’s arrest, and he has agreed to surrender to federal authorities in Los Angeles on Monday.

If he is convicted of all nine counts in the indictment, Murkey could be sentenced to as much as life in prison because there is no statutory maximum sentence for criminal contempt.

Consumers who have credit problems should consult materials the FTC has developed that address credit repair schemes and other credit problems. The FTC’s web page – www.ftc.gov – contains several credit-related pages. The information can also be obtained from the FTC by calling its Consumer Response Center at (877) FTC-HELP.

The matter was investigated by the Federal Trade Commission and the Federal Bureau of Investigation.

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