This bill strengthens rules for credit repair organizations to prevent scams. Companies cannot charge until proving success at least six months later. It requires state licensing, five-year record retention, copies of all communications to consumers, and increases minimum damages to 500 dollars per violation.
Latest Action
Referred to the House Committee on Financial Services.
AI Summary
Plain-English explanation of this bill
This bill strengthens rules for credit repair organizations to prevent scams. Companies cannot charge until proving success at least six months later. It requires state licensing, five-year record retention, copies of all communications to consumers, and increases minimum damages to 500 dollars per violation.
Last updated: 1/6/2026
Official Summary
Congressional Research Service summary
<p><strong>Ending Scam Credit Repair Act or the ESCRA Act</strong></p><p>This bill revises the Credit Repair Organizations Act and creates additional requirements for credit repair organizations (CROs).</p><p>Under current law, it is illegal for a person (including a CRO) to make false or misleading statements regarding a consumer’s creditworthiness or standing to a consumer reporting agency or to a consumer credit provider. The bill additionally prohibits making such statements to the Consumer Financial Protection Bureau, the Federal Trade Commission, or law enforcement. To be subject to this prohibition, the bill also requires such statements to be made knowingly.</p><p>The bill also revises CRO obligations to consumers. A CRO is prohibited from charging a consumer for a service (e.g., getting inaccurate information removed from a credit report) until the CRO provides proof of success not less than six months after providing the service. The bill also requires additional disclosures to consumers, requires the retention of any recorded telephone calls, and increases the time records must be retained from two to five years. In addition, consumers must be given copies of all communications sent on their behalf.</p><p>Under the bill, all persons must be licensed by a state to act as a CRO. The bill also restricts a CRO’s ability to submit multiple credit disputes regarding the same information.</p><p>The bill also sets a minimum liability amount for damages of $500 for each violation of the Credit Repair Organizations Act.</p>
Key Points
Main provisions of the bill
Prohibits charging until proving success after six months
Requires state licensing for all credit repair organizations
Increases record retention from two to five years
Sets minimum damages at 500 dollars per violation
Limits multiple disputes about the same credit information
How This Impacts Americans
Potential effects on citizens and communities
Consumers would have stronger protections against fraudulent credit repair companies. Legitimate credit repair services would face stricter oversight. Scam operators would find it harder to charge upfront fees without delivering results.
Policy Areas
Primary Policy Area
Finance and Financial Sector
Scope & Jurisdiction
Jurisdiction Level
federal
Congressional Session
119th Congress
Citation Reference
306, 119th Congress (2025). "ESCRA Act". Source: Voter's Right Platform. https://votersright.org/bills/118-hr-306
