Most people have dings on their credit report that lower their score, potentially making it harder and more expensive for them to get a loan. It’s tempting in those cases to turn to a credit repair company, especially one promising an easy, quick fix.

But that can result in more issues and, according to the Federal Trade Commission, if the company you’re working with promises it can remove all negative information from your report, you know it’s a scam.

The FTC recently announced a permanent ban and some $12 million in penalties against Financial Education Services and its subsidiaries for violating the Credit Repair Organizations Act. In a 2022 suit, the FTC alleged the company preyed on consumers with low credit scores by luring them in with false promises of an easy fix and then recruiting them to join a pyramid scheme selling credit repair services to others, costing them millions.

Among the claims made by the company was that it could permanently remove all negative information from peoples’ credit reports and improve their scores, the FTC said.

“These companies promised to clean up people’s credit but failed to deliver. Meanwhile, honest businesses make money selling products and services, not by recruiting, and the drive to recruit, especially when coupled with inflated income claims, is the hallmark of an illegal pyramid,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection.

While there are ways to fix errors on a credit report, you can’t legally remove information that’s correct and up-to-date, and neither can a company that makes claims otherwise.

Credit repair companies are required to explain your legal rights and provide a total cost in a detailed contract before they start work. It’s illegal for a company to charge you before it provides help, the FTC said.

You can do most of the things a credit repair company can do on your own. Here’s how, according to the FTC:

• Get your free credit report from AnnualCreditReport.com. Equifax, Experian, and TransUnion offer free weekly reports online.
• Read the reports. If you see a mistake, write to the credit bureau and the business that reported the information. Use this sample dispute letter.
• Keep paying your bills on time, pay off debt, and don’t take on new debt: it will improve your credit.

If you have a problem with a credit repair company, or see a scam, fraud, or bad business practice, please tell the FTC at ReportFraud.ftc.gov.