|
John Kendrick
speaking about
The Credit
Services Act
at the
Optimist Club
of Havertown
Pennsylvania shakes
hands with President Bernard
Romani (1988)
|
The Credit Services Act In the early 1980's consumer's who had problems with credit, collection agencies,
and credit reporting companies really didn't have to many options for help with credit problems. As if things weren't
bad enough credit repair companies(most of whom were illegal) were taking advantage of consumers who needed help
the most. The so-called "credit repair" companies would take consumers money with a false promise to repair their
credit over a period of time (usually 6 to 18 months). Some of the cases could be repaired by simple proceedures,( which consumers
could probably do for themselves if they knew the laws and how to exercise their rights). But the more serious cases could not be repaired. These were the cases that the credit
repair companies assigned an 18 month processing time. This translated into about a year and a half,
which was just enough time for the credit repair companies to grab up as much as money possible and get "outta
town" before any one got wise. Unfortunately consumers who had credit problems were getting hit from all
sides at the same time, with no help in sight.
|
|
Consumer
Credit Education & Protection Cooperative took up the banner for the Credit Services
Bill and promoted the legislation state wide through radio and TV public service announcements and a
series of free credit education seminars. The bill was
stalled in the state legislature for a period of time but because of consumer pressure the bill was finally passed into
Pennslylvania State Law as The Credit Service Act No 1992
-150, and eventually became federal law as The Credit Repair Organizations
Act.
|
State Representative
David P. Richardson of Philadelphia recognized consumers need for help, and in 1985 agreed to introduce legislation
to regulate credit repair companies. The legislation was titled The Credit Services
Act. The bill required any company selling credit repair services to consumers must be bonded. The credit
repair company can not charge or recieve any fees prior to informing the consumer of their rights and the fact that consumers
can repair their own credit. The bill established standards
of practices for credit repair companies, and provisions for protection of consumers who may buy their services.
|
|
Credit Counseling
..The Montgomery County Opportunity Board recently(1985) sponsored a credit counseling course at the Abington Library. Participating
in a series of citizen seminars, were Rodney Burrell and John Kendrick of Consumer Credit Education
and Protection Cooperative; Sandra Fields, Opportunity Board volunteer;
program moderator State Represntative Jon Fox, Rita Wiley, Opportunity Board Staff
member and A. Melvin East Director. Mr Kendrick spoke about the Credit Services Act
and how consumers can repair their own credit.
|
The bill prohibited
any credit service organization from making or counseling or advising any buyer to make any statement
which is untrue or misleading or use any untrue or misleading representations in the offer or sale of the services of
a credit services organization. The company can not charge or recieve any fees prior to providing an information statement
that shall include the following: (1) a statement informing the consumer
of their rights and the fact that consumers can repair their own credit. (2)
a detailed description of the services to be performed by the credit services organization and the total the buyer will have
to pay for the sevices. (3) the name and address of the surety company
with which the credit services company is bonded and the buyers right to proceed against the bond or trust account if
they suffer damages from any action performed by the credit services organization. The
credit services organization must provide a written contract detailing all services provided including total costs charged
the consumer, and the estimated date by which such services are to be performed, including a "right of recession"
allowing the buyer to cancell within 5 days.
|
