Tuesday, November 20, 2012

Consumer Financial Protection Bureau to Supervise Debt Collection Firms

The Consumer Financial Protection Bureau created new rules in order to supervise large debt collection firms. Beginning January 2, the government agency will regulate debt collection firms that have over $10 million in annual receipts. The rules ensure that the debt collectors are providing consumers with disclosures and accurate information and not harassing or deceiving consumers in their attempts to collect on a debt.

The Consumer Financial Protection Bureau has authority over three types of debt collection companies – companies that buy debt and collect the proceeds (which may be a portion of what is actually owed), firms that recover the debt owed on behalf of another company (and charge a fee for their service) and lawyers who collect through litigation.

Wednesday, September 26, 2012

People are losing their jobs as a result of debt collectors.

People are losing their jobs as a result of debt collectors. Debt collectors are calling consumers at their place of work and harassing them.

The New York Better Business Bureau and Attorney General’s office haver received numerous complaints about a debt collector known to harass consumers - Eltman, Eltman and Cooper. Fred Lembeck, a freelance writer, who is also on disability, claims Eltman, Eltman and Cooper began harassing him when he fell behind on his credit card payments. The firm went as far as to freeze his bank account, so that he did not have access to his only form of income, his social security check.

Harassing consumers at work and interfering with your social security payments are not allowed under the Fair Debt Collection Practices Act.

Watch a recent report by New York City Local News Channel CW11 on debt collector harassment. http://www.youtube.com/watch?v=wao6wv1Fqe4

Friday, June 22, 2012

Debt Collectors’ Automated Calls Violate the Telephone Consumer Protection Act

The U.S. Court of Appeals for the Seventh Circuit ruled that if a debt collector’s automated system continues to call a reassigned telephone number without the prior express consent of the new recipient, then the debt collector is liable for statutory damages even if the previous subscriber with that telephone number had consented to the automated calls. The actions of the debt collector were found to violate the Telephone Consumer Protection Act.

In Soppet v. Enhanced Recovery Co., two consumers with overdue bills had consented to receive automated calls on their cell phones, but then changed their phone numbers. As a result, when a debt collector’s automated system tried to contact the consumers at the provided numbers, the calls instead were received by the new subscribers to whom those cell phone numbers had been reassigned. The recipients of the calls then filed a class action against the debt collector.

The Seventh Circuit reasoned that its ruling follows the Telephone Consumer Protection Act, which consistently uses the phrase “called party” to refer to the actual rather than the intended recipient of the call.

The Seventh Circuit’s decision will require debt collectors who use automated systems to ensure that the actual recipients of automated calls have consented to receiving them, and take steps to update their records when telephone numbers have been reassigned to new subscribers.

Wednesday, June 6, 2012

Debt Mediator and Collections Specialist

In 2008, Alex Nathan lost his job and his home. He lived in the Salvation Army’s Sarasota homeless shelter until he found a job as a debt mediator and worked to get his financial situation under control. He read an article regarding Harvey Vengroff, a collections multimillionaire, who was offering free space to entrepreneurs in return for a stake in their businesses. After several meetings, Vengroff offered to support Nathan’s company, Legal Debt Solutions.

Legal Debt Solutions helps people who have unmanageable credit card bills to reduce their payments and offers options for people who need help with their mortgages. Legal Debt Solutions will take one person’s debts and pool them with hundreds of others, and negotiate with creditors to cut the debt of all the people in the pool. The creditors benefit because the debtors do not file bankruptcy, where the court may wipe out the debt completely. The debtors benefit because their debt is lowered and they can begin to repair their credit. Legal Debt Solutions benefits as well because they collect a percentage of the total debt.

Wednesday, May 9, 2012

Debt collector to pay $10 million for abusive debt collection practices

A West Virginia woman was awarded a $10 million settlement against a debt collector. Reliant Financial Associates (RFA) left a message saying that her house was in jeopardy if she didn’t pay the debt. The debt collector threatened her with action against her property and it wasn’t even her debt. She was a victim of mistaken debtor identity.

This type of harassment is more common partially due to debt buyers, a form of debt collectors. They purchase old debts that the original creditors have given up on, and then try to collect the money in order to make a large profit.

The West Virginia woman followed the correct procedure and wrote a cease and desist letter and sent it via certified mail. She received the confirmation showing RFA received the letter and then the calls began. She received several calls when answered, the caller would hang up. The caller ID showed the calls were coming from her local county government. She returned the call and found it went to the sheriff’s department and they informed her that no one was calling her from their office. The caller ID had been manipulated to look like it came from the sheriff’s office, a practice called “spoofing”.

One call she received, the caller began yelling at her using vulgar terms. The verbal assault went on for nearly two minutes before the man hung up. She immediately called 911 stating someone had threatened to assault her. At first, she didn’t correlate the obscene telephone call with the debt collector, until she did some research on the internet and found other women had been subjected to the same abuse.

Last May, the woman sued RFA for harassment and illegal debt collection practices. The RFA’s lawyer failed to appear in court. The judge called RFA’s actions “malicious” and awarded the record $10,860,000 judgment.

RFA is a fictitious name for a company called Global AG, LLC. RFA is just one of the collection companies run by the same people. This is common practice for debt collection agencies to change their names often to make it more difficult to file suits against them.

Tuesday, May 8, 2012

Debt collector disguising employees as emergency room personnel

A debt collections company, Accretive Health, is under scrutiny by the Minnesota attorney general. The debt collector is accused of hiring debt collectors as employees in emergency rooms and demand that patients pay before receiving treatment. Patients may think they are hospital employees until they realize they are demanding payment and may even discourage them from seeking medical help. In some cases, the debt collectors had access to health information.

The Accretive Health employees may have broken the law by not identifying themselves to patients as debt collectors. The Minnesota attorney general has not brought action against the debt collector, but has discussed the situation with state and federal regulators. However, a suit had been filed against Accretive Health when a laptop containing patient information was stolen, stating the debt collection company had violated state and federal debt collection laws and patient privacy protections.

Thursday, March 15, 2012

Debt Collectors Harassing Widows

Debt collectors are continuing to harass widows and other family members to collect on the debts left by their deceased loved ones.  Harassing telephone calls and phony lawsuits are two of the means by which the debt collectors are trying to get the money owed.  This is illegal.  When you die, your estate may be liable for valid debts, but your family members are generally not liable for your debts.  One exception is when a family member guarantees a debt, such as a credit card.

One widow was contacted on the day of her husband's funeral by a debt collector trying to collect on a debt that her husband had incurred seven years before they were married.  Another woman was contacted at her work and at home for several months to collect on a debt for a truck her father had purchased before passing away.  It is not illegal to contact the family of the deceased, but it is illegal to harass them.

If you are being harassed by a debt collector, please contact us.

Monday, February 20, 2012

Credit Scores and Debt

There can be a lot of confusion when it comes to credit scores.  First of all, there is more than one credit score.  The most popular is the FICO score.  However, each of the three credit reporting agencies has a different formula to calculate the FICO score, resulting in higher and lower scores for consumers.

Second, a credit card company may use a different score to approve a loan than a home mortgage lender or auto loan financial institution would use, so the lenders are not consistent with the scores used to accept applications.

Another problem resulting from the recession is that many consumers have had their inactive credit cards closed by financial institutions.  This increases the outstanding debt to the available credit ratio, resulting in a lower credit score.

Outstanding uncollected debt that is older than seven years will be removed from the credit report.  Therefore, if you are being harassed by debt collectors and you make a payment because you think it will stop them from calling, then the clock on the time limitation will restart.

If you are being harassed by debt collectors, please contact us at 866.553.3272.

Friday, February 17, 2012

Debt Collector sends elderly woman to the hospital.

Anne Sessions had always paid her bills on time until 2010 when she had financial problems and was facing foreclosure. Wells Fargo debt collectors began harassing her with telephone calls and threatening to take legal action. She was able to work out a payment plan with her modest fixed income.

The harassing calls ceased until February of 2011 when a debt collector began harassing her even after she explained she had already set up a payment plan to pay off the three months she was in arrears. She told the debt collector that this type of harassment is what leads to people abandoning their homes and in some cases, committing suicide.

The debt collector continued to harass Ms. Sessions and asked inappropriate questions about how she might kill herself. Three police officers arrived at her home and told her that the employee had called 911 and reported she had threatened to commit suicide. The police forcibly took her to an emergency room where she was held for several hours, reviewed by medical staff and released. She later received a bill from the hospital for $1,055.

Ms. Sessions contacted the company to speak to the debt collector and was told he was unavailable but heard the co-worker laughing as she congratulated him on how effective his call had been and that the police had taken Ms. Sessions to the hospital. Ms. Sessions said the incident caused her extreme anxiety and embarrassment. She is suing for $250,000.

If you are being harassed by a debt collector, contact us at 813-314-4595 or 866-553-3272.

Thursday, February 2, 2012

Asset Acceptance, A Debt Collection Company, Will Pay $2.5 Million Fine

Asset Acceptance, a debt collection company, had been contacting consumers trying to collect debts that were not owed. In some cases, the debt was too old to collect because it was past the statute of limitations. If the consumer was to make a payment on the old debt, the clock on the debt would be restarted allowing debt collectors to take legal action.

The Federal Trade Commission states that Asset Acceptance has agreed to pay a $2.5 million fine. In addition, the debt collectors will have to tell consumers that their debt is too old to legally enforce, and the company will not be allowed to enter the debt on the consumer’s credit report without informing the consumer first.

For more information on your rights, contact us.