Credit Repair

Overwhelmed by debt? Hey, pay a company to get rid of it by saying it never really happened in the first place.

When you apply for a credit card, your signature becomes an asset on the bank's books, because you have "promised to pay." With your signature, the bank can create money — so you, therefore, are actually the lender and are entitled to sue the bank for the maximum credit limit. Quite simply, you can't default on a loan because the only loan was from you to the bank.

Gregg Stevens, a commercial litigation attorney in the Dallas office of McGlinchey Stafford, has spent a lot of time dealing with these sorts of schemes. In April, he gave a presentation on debt-elimination scams at a Texas State Bar seminar.

"Basically the presentation was that these scams really have no basis in law or fact," Stevens says. "...Usually, folks have decent credit going into the scam and...by the time they get done dealing with and purchasing the scam, they're out the money they paid for the scam, they haven't eliminated their debt and their credit's usually worse."

Bob Lindsey's business skyrocketed once he posted videos online.
Bob Lindsey's business skyrocketed once he posted videos online.
Robert Lock's company used the Texas Attorney General's Office to shut down a competitor.
Robert Lock's company used the Texas Attorney General's Office to shut down a competitor.

But yet this theory flourishes, and it seems to have increased in popularity with — or at least many of those who push this theory have read — the 1994 book The Creature from Jekyll Island, by G. Edward Griffin. A man who has rarely met a conspiracy theory he didn't like, Griffin's book purports to be the true account of the "secret" history of the U.S. Federal Reserve, which, as it turns out, is neither federal nor a reserve. In Griffin's world, the United States, under the control of a shadowy group called the Rhodesians, rigged the World Trade Center explosions; Lee Harvey Oswald did not act alone; and the modern pharmaceutical industry was largely molded and influenced by a secret pact between Adolf Hitler, Standard Oil and John D. Rockefeller. Clearly, this is one dude who has his shit together. The book's approach to the allegedly nefarious way money is created helped herald a new wave of conspiracy theorists.

So armed with this type of knowledge, Lindsey talked in his videos about how it wasn't the consumer's fault and how the system was rigged. How the bankruptcy laws had become so twisted that filing Chapter 7 no longer offered a fresh start. (Although Lindsey has twice filed for bankruptcy, he doesn't recommend that for any of his clients). And not only could he help you invalidate your debt, he could sell you the right to become an affiliate. He'd give you the tools to set up your own Web site (which would inevitably have a respectable name along the lines of www.kissyourdebtgoodbye.com) and sell you a kit of gigantic car magnets so you could pimp out your Hyundai and turn it into a traveling billboard.

He was careful not to call this partnership a "business opportunity," because the Texas Attorney General's Office in 1994 had enjoined him from doing such.

Back then, Lindsey was the vice president of the Child Support Collection Agency of America. That company, according to the Texas AG, sold "private child support collection" licensee rights for $990-$15,000. The advertisements promised people that they could "make a fortune collecting past due child support from deadbeat parents." Some ads promised upwards of $250,000 a year.

According to the complaint, Lindsey and his licensees called parents who were under court orders to send child-support payments into a court registry, and, using aliases and often calling themselves "detective" or "investigator," demanded that the parents pay them directly. Strangely, this seemingly bulletproof business model proved unsustainable. After about 18 months, when licensees found they didn't make enough from the business to fill Olympic-size swimming pools with $100 bills, they started filing complaints with the AG.

The AG's complaint also dredged up his 1992 no-contest plea to a count of "engaging in organized crime in the first degree," for which he received 60 days in jail and ten years' deferred adjudication.

The complaint didn't describe the nature of the organized crime, but the way Lindsey puts it, it's not as sensational as it sounds: He told the Houston Press that he had conspired with a third party to buy a piece of industrial machinery from a leasing company and then sell it back to them.

If that doesn't make sense, or just simply doesn't even sound like a good scam, it's because, Lindsey says, that was back in the Cocaine Days.

Sitting in a tiny room in a north Beltway office building — due to the Texas AG's freezing of his company's assets, Lindsey has been locked out of his office since July — Lindsey was candid about his former drug use.

"It's a progressive disease — it just gets worse and worse," he says. "...Toward the end, I just couldn't function. All I wanted to do was get high."

And get high he did. In fact, he stopped seeing his probation officer in 2000 because he knew he wouldn't pass the drug screen. So after six weeks in Harris County Jail, he went to the six-month Residential Substance Abuse Treatment center in Atascocita.

"It put me on the road to sobriety," Lindsey says, acknowledging that there were a few slip-ups at first. "I can't say that I was perfectly sober once I got out...But I never went back to where I was."

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