Nearly 200 web-sites offering to restore the creditworthiness of financially troubled consumers have been notified by the authorities that their claims may violate federal and state laws.

Their possibly illegal promises were uncovered during a recent "surf day" when 10 state attorneys general's offices, 29 local better business bureaus, the National Foundation for Credit Counseling and six of their Neighborhood Financial Care Centers went searching for credit repair sites that appear to be making deceptive advertising claims.

The sites were told via e-mail by the Federal Trade Commission that, while it has not yet been determined whether they are illegal, they may indeed violate several federal and state statutes.

"If your company engages in any deceptive or fraudulent credit repair activities, we strongly urge you to stop; otherwise, you may be subject to legal action," the sites were warned.

The FTC has already taken legal action against numerous companies that deceptively advertised credit repair products and services on the Internet. And the consumer watch-dog agency has "copied and preserved" the ads of the latest potential targets "for future reference."

Besides the FTC, the crackdown is being sponsored by the Justice Department and 47 other federal, state and local law enforcement and consumer protection agencies.

According to the FTC, many credit repair operations falsely "guarantee" they can remove negative information from someone's credit report, even if the information is accurate and timely. But they can't.

Over 60 of the sites identified also sell instructions telling consumers how to substitute a false Social Security number for their correct one and "start fresh" with a new identity. They claim the scheme is perfectly legal. Of course, that isn't possible, either.

Any credit repair operation that claims it can improve a consumer's credit report and charges for that service in advance is violating the Credit Repair Organizations Act (CROA), a new federal law designed to help consumers combat fraudulent credit repair scams.

"I'd like consumers to remember three things about credit repair," said Jodie Bernstein, Director of the FTC's Bureau of Consumer Protection.

"First, accurate and timely negative information cannot be removed from a credit report in an effort to repair it. Second, it's not only a bad idea to try to create a new credit identity using a false Social Security number, it's also illegal. And third, when it comes to credit repair, only time and a personal debt repayment plan will improve your credit report."

The FTC has developed several brochures for consumers that address credit repair schemes. They are available at the agency's web site ( www.ftc.gov); via telephone toll free at 877-382-4357, or from the FTC Response Center, Room 130, 600 Pennsylvania Ave. NW, Washington DC 20580.

Published: August 28, 2000

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When Lew Sichelman first started writing about housing in 1969, he was the youngest real estate writer in the country. Now, 37 years later, he's one of the oldest -- and most decorated. He has been rated the top housing columnist in the country by the National Association of Realtors as well as by his peers in the National Association of Real Estate Editors. Indeed, NAREE has recognized his work on numerous occasions. One year - due to his advancing age, he can't recall which one - he earned top honors in the annual NAREE Journalism Contest in three out of the four major writing categories. It was the first time one writer has won so many NAREE awards in a single year. Known for his ability to make even the most difficult topics understandable, Sichelman also has been honored by the National Association of Home Builders and the Mortgage Bankers Association. He began providing in-depth coverage of and consumer-oriented information about housing and housing finance at the Washington Daily News, where he was real estate editor. He held that same position for nine more years at the Washington Star, which purchased the News in 1972. The Star, a so-called "writer's newspaper" which also had the misfortune of being an evening paper, was put out of its misery in 1981, and Sichelman, who had begun self-syndicating his column in 1978, decided to become a full-time columnist. Today, his column, "The Housing Scene," is distributed by United Media to newspapers throughout the country. He also is on the staff of National Mortgage News, an independent newspaper which is considered the bible of the mortgage business. And he writes for numerous other publications, including MarketWatch.com, where he answers readers questions once a week, Sports Illustrated (don't ask), RealtyTimes.com, BigBuilder and others. Sichelman is married, the father of five and grandfather of eleven.