Lexington Law Admits to Operating an Illegal Business – Turn to Lakeshore Law Center for Real Legal Representation
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Understanding the Key Legal Distinction
Lakeshore Law Center’s model is simple: we accept a onetime, $5,000 flat fee to investigate your case and file suit under the California Consumer Credit Reporting Act (CCCRA) or related consumer protection statutes. Because this fee is paid to a California licensed attorney for bona fide legal work, it is governed by the State Bar of California’s Rules of Professional Conduct, which permit reasonable upfront fees for actual legal work.
Lexington Law, on the other hand, marketed generic “credit repair” packages over the phone and on the Internet, charging consumers monthly in advance before any measurable results were delivered. As a nonlawyer credit repair organization, Lexington Law was subject to the federal Credit Repair Organizations Act (CROA) and the Telemarketing Sales Rule (TSR), both of which prohibit collecting payment until after documented results are provided. Their failure to comply triggered the massive enforcement action described below.
Recap of the CFPB’s Landmark Case Against Lexington Law
In August 2023, the Consumer Financial Protection Bureau (CFPB) secured a $2.7 billion judgment against Lexington Law and its affiliates for illegally charging advance fees. The settlement:
- Bans the companies from telemarketing credit repair services for 10 years.
- Requires restitution procedures for affected consumers.
- Adds one of the largest penalties ever imposed in the credit repair industry.
Roughly four million Americans paid Lexington Law hoping for quick credit boosts, only to receive little—or nothing—in return.
Why UpFront Fees Are Usually a Red Flag
| Service type | Governing law | When payment is allowed |
| Attorney retainer | State Bar rules (e.g., Cal. Rules of Professional Conduct § 1.15) | A licensed attorney can charge a retainer or flat fee to prosecute a lawsuit. |
| Credit Repair telemarketing | CROA (15 U.S.C. § 1679b) & TSR (16 C.F.R. § 310.4) | Only after verifiable results have been achieved |
If a credit repair outfit asks for money before producing evidence—especially over the phone—walk away. Only legitimate law firms can charge a flat fee and must still document their actual time spent to show the fee is reasonable.
Common Myths Exposed by the Lexington Law Case
- “A third party can wipe every negative mark overnight.”
Accurate but adverse data usually remains seven years (ten for bankruptcies).
- “Paying upfront guarantees faster results.”
CROA and the TSR exist precisely because advance fee promises so often prove false.
- “All credit disputes are the same.”
Legal disputes hinge on specific violations—such as failure to investigate, mixed files, or inaccurate furnisher reporting—not generic form letters.
How Lakeshore Law Center Safeguards You
- Licensed representation – Your matter is handled by attorneys admitted in California courts and federal district courts.
- Transparent trust accounting – Your $5,000 flat fee is used to fund an actual lawsuit not to write dispute letters.
- Litigation ready strategy – We prepare every case with trial in mind, pressing creditors and bureaus for full statutory damages, actual damages, and attorney fees when they violate the credit reporting laws.
- Attorney client privilege – Your communications and financial documents stay confidential.
“Consumers deserve advocates bound by state bar ethics rules—not phone scripts,” says Jane Doe, a consumer protection attorney with 15 years’ experience.
Frequently Asked Questions
Q 1: Why can Lakeshore Law Center collect an upfront retainer when Lexington Law could not?
Because attorneys may accept reasonable retainers or flat fees for actual litigation; CROA bars nonlawyer credit repair companies from taking money until results are proven.
Q 2: I paid Lexington Law. Can I get a refund?
The CFPB is creating a redress program. Keep your contracts and billing records and consult legal counsel to preserve your claim.
Q 3: Do I still owe Lexington Law monthly fees?
If you are being billed despite the settlement, speak with an attorney immediately—you may have grounds to dispute or cancel further charges.
Q 4: What happens to my $5,000 retainer at Lakeshore Law Center?
Your payment is applied toward attorney fees and court costs for the prosecution of the lawsuit. You will not be charged any monthly or additional fees, although Lakeshore Law will try to compel the parties you are suing to pay additional legal fees.
Protect Yourself Moving Forward
- Pull all three credit reports annually at www.AnnualCreditReport.com.
- Document every collection call, letter, or bureau response.
- Question any service demanding payment before performance—unless it is a licensed law firm providing verifiable legal work.
Ready for Real Legal Help?
Illegal credit repair schemes cost time and money. Choose counsel that follows the law.
Call Lakeshore Law Center at (714) 8547205 or visit www.creditrepairdebt.org to schedule a consultation and put a licensed attorney on your side.