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The operator of a Web site that sold credit repair advice and promised "perfect credit . . .instantly" has agreed to settle Federal Trade Commission allegations that his scheme violated federal law.

The scam was identified in "Operation New ID - Bad IDea," an FTC initiative targeting illegal "credit repair" services. The settlement bars future violations of the Credit Repair Organizations Act and the FTC Act; bars deceptive claims about file segregation -- including claims that it is legal -- and prohibits the defendant from using or selling his customer lists.

In addition to the civil case brought by the FTC against Clifton W. Cross, on May 9, 2001, Cross was sentenced to forty nine months in federal incarceration and ordered to pay nearly $171,000 in restitution as part of a guilty plea resolving criminal charges stemming from the scam. The criminal case was prosecuted by the United States Attorney for the Western District of Texas.

The defendant used his Web site to claim he could help consumers obtain new credit histories by obtaining new identification numbers through a practice known as file segregation. The defendant sold instructions about how consumers could substitute federally-issued, nine-digit employee identification numbers or taxpayer identification numbers for social security numbers and use them illegally to build new credit profiles that would allow them to get credit they may be denied based on their real credit histories. Using "file segregation" to alter your credit history is a felony.

Settlement of the FTC charges bars the defendant from representing that other government identification numbers can be lawfully used to conceal actual credit histories or that using alternate numbers is legal. In addition, the settlement bars him from misrepresenting material facts concerning credit-related products or any other product or service. The settlement also bars violations of the Credit Repair Organizations Act, which prohibits charging or accepting payment for credit repair services before the services are provided and advising consumers to hide their true credit history. The settlement also bars the defendant from using or selling his customer lists. Finally, the settlement contains record keeping provisions to allow the FTC to monitor compliance. A financial declaration filed by the defendant indicates an inability to provide redress for consumers. The settlement contains provisions to allow reopening of the issue if the defendant is found to have misrepresented his inability to pay.

The settlement with Clifton W. Cross, individually and doing business as BUILD-IT-FAST, was filed in United States District Court for the Western District of Texas, Midland-Odessa Division. The Commission vote to accept the settlement was 5-0.

NOTE: Stipulated final judgments and orders are for settlement purposes only and do not constitute an admission by a defendant of a law violation. Consent judgments have the force of law when signed by the judge.

Copies of the judgment are available from the FTC's web site at and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint, or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at The FTC enters Internet, telemarketing, identity theft and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

(FTC File No. X990025)
(Civil Action No. M099CA018)

Contact Information

Media Contact:
Claudia Bourne Farrell or Howard Shapiro
Office of Public Affairs
202-326-2181 or 202-326-2176
Staff Contact:
C. Steven Baker,
Midwest Regional Office