Jamming

What is 'Jamming'

A scam perpetrated by bogus credit repair firms that involves the mail out of dispute letters en masse to credit bureaus on behalf of consumers with spotty credit histories. Jamming is so called because it clogs up the dispute process. Since credit bureaus only have 30 days to verify disputes, an inordinately large number of dispute letters would result in their temporary removal from consumers' credit records. These dispute letters request removal of information that reflects negatively on a consumer's credit record - such as non-payment or chronic late payments of bills - but that is perfectly accurate and legitimate.

BREAKING DOWN 'Jamming'

Fraudulent credit repair firms make a bad situation even worse for a consumer with a poor credit record. These firms typically charge a substantial amount payable upfront to repair one's credit. The hapless consumer who believes that his or her credit record has been successfully repaired soon finds that the disputed information is back on the credit report, because it was correct to begin with. But now the consumer is also out of pocket to the extent of the fees paid to the credit repair firm, which often run into thousands of dollars.

Jamming also affects consumers who are legitimately disputing items on their credit records, since the fake disputes filed by fraudulent credit repair firms will clog up the system and delay the resolution of real disputes.

The Federal Trade Commission (FTC) in its "Consumer Information" section, includes "jamming" as one of the five signs of a credit repair scam:

  • the credit repair company demands upfront payment before doing any work on your behalf;
  • tells you not to contact the credit bureaus directly;
  • tells you to dispute information in your credit report even if it's accurate (i.e. jamming);
  • encourages you to falsify information on credit or loan applications;
  • does not explain your legal rights.