The Credit Repair Organizations Act (CROA) outlines the rules and regulations for credit repair organizations.

Although, it’s commonly believed that credit repair organizations are illegal- they are perfectly legal in every state EXCEPT Georgia. In the state of Georgia, operating a credit repair organization is classified as a misdemeanor.

The Act details several rules; for example, a credit repair organization cannot bill you in advance for services that have not yet been rendered. They also have to disclose to you that you can challenge information on your personal credit reports for free.

The Federal Trade Commission enforces the CROA. In 2008, the FTC closed down 34 credit repair organizations for violations of CROA in as part of a project referred to as “Project Clean Sweep.”