LOS ANGELES – 3 March 2005 – LAWFUEL – The Law News Network – Concluding the first-ever criminal contempt prosecution related to a
deceptive credit repair scheme, a Las Vegas man has been sentenced to 51 months in
Richard Murkey Sr., 58, who formerly resided in Chatsworth, California was
sentenced yesterday by United States District Judge S. James Otero. In addition to
the prison term, Judge Otero ordered Murkey to pay approximately $126,000 in
Murkey pleaded guilty in April 2004 to four counts of criminal contempt of court.
Murkey used infomercials, newspaper advertisements and other means to lure
consumers into purchasing credit repair services. He made 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. 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 that found Murkey had systematically violated the
law and banned him from offering credit repair services. The court also prohibited
Murkey from promising consumers more results than he could deliver and barred him
from misleading credit reporting companies about his clients’ credit histories.
Immediately after the court’s order was issued, Murkey again began offering 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
the court in Los Angeles held Murkey in civil contempt. Murkey, however, returned
to credit repair several months after the civil contempt finding, using the bank
account of another person to operate his business clandestinely.
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
CONTACT: Assistant United States Attorney Julie Werner-Simon
Release No. 05-039