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Florida Company Sued for FCRA Violation
The United States has filed a complaint against three related companies that bought and sold consumer credit reports, the Grimy Times has learned.
The government’s complaint charges Direct Lending Source Inc., Bailey & Associates Advertising Inc., Virtual Lending Source LLC, Robert M. Bailey, Jr., and Linda Giordiano with violating the Fair Credit Reporting Act (FCRA). The companies have agreed to pay a $1.2 million civil penalty to resolve these charges.
The complaint alleges that the defendants purchased thousands of “pre-screened” consumer lists, or collections of credit report data. However, the defendants re-sold the lists to dealers who marketed loan modification, debt relief and credit repair services rather than making firm offers of credit.
The complaint also alleges that the defendants did not take reasonable steps to identify the ultimate purchasers of the credit reports. In some cases, the defendants sold lists to brokers who then re-sold them to unidentified entities.
“The sensitive financial information in credit reports must be protected from those who would use it to target vulnerable consumers for sham offers,” said Stuart Delery, Acting Assistant Attorney General for the Civil Division. “We will work with the Federal Trade Commission to aggressively enforce the laws that safeguard these reports.”
The proposed consent decree would prohibit the defendants from using, obtaining or reselling consumer reports for unauthorized purposes. The proposed order also would prohibit the defendants from selling consumer reports in connection with solicitations for debt relief and mortgage relief services that charge advance fees.
Defendant/respondent: Direct Lending Source Inc., Bailey & Associates Advertising Inc., Virtual Lending Source LLC, Robert M. Bailey, Jr., and Linda Giordiano
Criminal charges: Violating the Fair Credit Reporting Act (FCRA)
City and state: San Diego, California; Florida
Date: October 9, 2012
Sentence/outcome: $1.2 million civil penalty
Dollar amounts: $1.2 million
Key Facts
- State: Federal
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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