Debt Collection Abuse Protections For Consumers In NY

Trying to protect the public from the "exploding" collections industry, the New York state Assembly has passed a series of bills aimed at fighting abusive and unfair collection practices in New York State.

The package of bills includes amending the state Debt Collection Practices Law to create a private right of action by a debtor who has been a victim of improper debt collection practices. This would be a critical addition to state protections in light of the debt collector's trade group, ACA International, hiring a Washington lobbyist to kill an individuals' right to file a private suit against abusive debt collectors.

The legislation passed by the Assembly would also prevent collectors from seizing income that is exempt from collection under state and federal law, such as Social Security and veterans' benefits.

Collection Agency Midwestern Health Mangement Contacting Patients Under Phony Name

There are state and federal regulations to discourage collection agencies from abusing consumers. However, if the consumer doesn't know the real name of the collection agency, accurate complaints to authorities are harder to come by.

A lawsuit has been filed in U.S. District Court against the Midwestern Health Mangement Inc., collection agency, and its parent company, Heartland Health for using those same deceptive practices.

Attorneys representing Brett and Saundra Smith and Aaron Dillman, all of St. Joseph, filed a document Monday in Kansas City stating that Heartland, through Midwestern Health Management Inc., the company with which it has contracted to collect patients’ debts, has attempted to deceive by using the “fictitious” name Northwest Financial Services when contacting people with alleged medical bills. The lawsuit describes Midwestern as a wholly owned subsidiary of Heartland. The two entities share the same corporate officers, the lawsuit said.

The lawsuit is seeking class-action status. If a judge certifies the case as a class-action lawsuit, its outcome could affect every Heartland patient who has been contacted in the past year by Northwest Financial Services.

“We’re talking tens of thousands of people,” said Derek Potts, one of the attorneys representing the plaintiffs.

The lawsuit claims Heartland is in violation of the Fair Debt Collection Practices Act, a law that makes it illegal to deceive consumers about who it is that is trying to collect money from them.

In this situation, attorneys say, the plaintiffs received phone calls from individuals identifying themselves as representatives of Northwest Financial Services, as well as correspondence with the heading Northwest Financial Services attempting to collect money they allegedly owed to Heartland. But nowhere on the correspondence was it indicated that Northwest Financial Services was related to Heartland.

More..

Jefferson Capital Systems Collection Agency And CompuCredit Hammered By Feds

After CompuCredit failed to present an acceptable settlement offer to the U.S. government, U.S. regulators moved forward and accused CompuCredit Corp and two banks of deceiving hundreds of thousands of credit card customers by withholding important details and blindsiding them with fees. The FTC lawsuit also names collection agency Jefferson Capital Systems, a subsidiary of CompuCredit, as a defendant for violations of the FTC Act and the Fair Debt Collection Practices Act (FDCPA).

The regulators filed a series of civil and administrative-proceeding charges against the companies seeking more than $200 million in restitution and civil penalties.

After a joint investigation by one agency that regulates banks and another that enforces consumer fraud and deception rules, the regulators said the companies engaged in "unfair and deceptive practices" by failing to properly disclose upfront fees and credit limits to consumers with poor credit.

More...

RJM, CACH, Asset Acceptance, LVNV Funding And Other Zombie Debt Collectors Jamming Civil Courts

RJM, CACH, Asset Acceptance, and LVNV Funding collection agencies are well known to victimized consumers and consumer attorneys. What is now becoming clear to the media, however, is the scale of their actions.

In Chicago, for example, more than 119,000 civil lawsuits against alleged debtors are clogging courtrooms, and at least half will result in judgments that debt collectors will use to dock wages, seize bank accounts and file liens against homes, compounding the woes of troubled borrowers.

But because debt collectors operate on volume, pushing through lawsuits based on little more than lists of names, addresses and alleged amounts due, there are also plenty of instances of mistaken identities, cases where debts are alleged when the bills have been paid and even situations where people have fallen behind and tried to work out repayments only to be hauled in to court.

More...

Ebay Sends Paypal Users To Collection Agencies

A California judge has said that upset consumers shouldn't fight PayPal in blogs online, but should sue in court.

Bill Brush feels as if he's been banished from one of the world's largest online networks -- eBay -- because of an ongoing dispute with PayPal."It's very frustrating," said Brush. I'm just an account number that owes them money. And they've made the decision, and that decision is unbendable. So I'm stuck."

Late last year, Brush, a computer security professional in Tacoma, sold one of his many personal laptops on eBay.The buyer, from New Zealand, swooped in at the last moment and bought the Thinkpad T-60 for more than $800. So Brush packed it up, headed to his local post office, and sent it off.

"When I came home, there was an e-mail waiting for me from PayPal saying that the transaction had been frozen and they recommended that I didn't ship the laptop," said Brush.

More...

Consumer Lawyer Peter Barry Goes After Those Who Live Off The Misery Of Others

If debt collectors thrive on intimidation, there's one man who strikes fear into them: Pete Barry. In the decade he's been suing dirty debt collectors, Barry has pried loose millions of dollars in damages. So successful are his techniques that he's begun teaching seminars nationally to train up an army of lawyers equipped with the weapons to sue rogue debt collectors and win.

"He's an incredible litigator," says Robert Hobbs, deputy director of the National Consumer Law Center. "He gets cases where people have been beat up very badly and he gets good money for them."

In person, Barry is no less impressive. With his linemen's physique and trim goatee, Barry could pass for a street fighter were he not decked out in a $3,000 suit. Sitting in his office, a spacious chamber in Minneapolis, Barry can't help but break into a grin as he discusses all the ways he bedevils the debt collection industry.

More...

Past Due Medical Bills Being Auctioned Online To Collection Agencies

In a move consumer groups say will increase pressure on people with unpaid medical bills, some hospitals are trying out a new tactic to recoup patients' debts: They're auctioning the debt online.

Hospitals have long relied on outside collection agencies to go after debtors. Under traditional arrangements, these agencies receive a percentage of any money they get from a debtor; the more they collect, the more they earn.

Now, some of the same collection agencies, as well as other firms that purchase debt outright, have begun participating as bidders in online auctions, in which they buy the debt or provide guaranteed payments to hospitals for access to the unpaid accounts. Some experts say this gives them more reason to aggressively pursue patients in arrears. Auctions can drive up the amount paid for debt, meaning a collector must recoup more money from patients to cover its initial investment and turn a profit. And the winning bidders often get to keep all the money they collect on the auctioned debt.

More...

Riddle & Associates Caught By State Attorney General

An investigation of Riddle & Associates, a collection agency law firm, by West Virginia Attorney General Darrell McGraw, has resulted in the end of Riddle & Associates representing DIRECTV in the state.

Nearly 300 West Virginia consumers received a collection letter from Riddle & Associates, falsely threatening to add attorneys fees and collection costs to alleged DIRECTV bills.

But Riddle & Associates had previously promised to end this unlawful and deceptive collection practice in a 2004 settlement agreement with Attorney General Darrell McGraw's office.

Riddle signed a new agreement again promising to refrain from using false collection letters, agreed to pay a fine to the state, and consented to cease collecting DIRECTV accounts in West Virginia.

DIRECTV agreed to close the accounts with a zero balance.

Farmers Insurance Sends Collection Agency After Homeless Fire Victim for $420,000 False Claim

First a devastating fire robbed a Seattle, Washington family of nearly everything. Then a big insurance company tried to take the rest and more, sending a collection agency to go after the family with a bill of $420,000.

Last October Chris Christoffersen and her daughter Melissa awoke to devastation. The apartment complex they lived in was engulfed in flames.

"I watched everything from throughout my life - gone. Gone in just a few seconds," she said. Now their furniture, TV, computer and even their clothes consist of second-hand donations.

The University Place Fire Department ruled the fire accidental. The fire had it started in the area where Christoffersen's couch was pushed against the baseboard heater. "These things happen, they're accidental. It's just the way it is and there was no malicious intent discovered at all," said Asst. Fire Chief Dave Dupille.

Then Christoffersen got a bill from a collections agency demanding that she pay $420,000.

More...

Maxed Out On Showtime Tonight

Maxed Out: Hard Times, Easy Credit and the Era of Predatory Lenders is a book and documentary that show abusive practices in the credit card industry. The book and movie use interviews with creditors and debtors. The film is on tonight at 7pm on Showtime and will also be on Monday May 26 at 10 am, and Thursday May 29 at 11pm. The film is also available through Netflix, Amazon.com and the usual locations.

The purpose for the book and the movie is to raise awareness of how credit and lending issues affect society. The film and book illustrate how banks and other creditors deliberately market to people who are more likely to have problems paying and that the creditors benefit from connections to government, the debt collection industry, and from lawmaker apathy.

The trailer is below.

Neon Claims Advantage Collection Agency Banned By New York AG

Neon Claims Advantage, a Nebraska debt collection agency, has agreed to be banned from doing business in the state of New York as part of a settlement agreement with the New York attorney general's office.

Before Neon's client, Quality First Auto Glass went out of business, it would estimate the cost of a repair, submit the estimate to the customer’s insurance company and then accept the amount the insurance company was willing to pay as payment in full for its auto glass repair work.

But once Quality First Auto Glass closed, it hired Neon to collect from the customers the difference between the company’s original cost estimate and the insurance company’s payment.

It didn't matter to the collection agency there was no legal obligation for anybody to pay the additional money since the insurance payments had been accepted as payment in full.

In all, Neon Claims Advantage had 424 accounts alleging over $233,000 in debts that did not exist.

The NY attorney general’s office, which began investigating after receiving complaints from customers, said Neon Advantage made misleading claims (alleging an actual debt) and did not validate the amount of the alleged debt in the letters it sent to the Quality First customers as required by the FDCPA.

The attorney general’s office intervened in the case before any of the 424 Quality First customers who were targeted by the debt collection agency paid any money on the collections attempts.

In a related settlement, the Attorney General’s Office permanently barred Alan Moore, dba Quality First Auto Glass, from attempting to collect the $233,000 again with a different collection agency or by any other means.

Audio and Video Of An Iraq Combat Vet Being Abused By Bill Collectors Over A Non Existant Debt

Minnisota consumer law attorney Pete Barry appeared on KMSP Fox 9 News on Tuesday, May 6, 2008, for a story on abusive debt collection. Includes audio of an Iraq combat vet at home on leave visiting his family being abused by telephone bill collectors even though there is no delinquency.

Click image to watch.

North American Recovery Collection Agency Forces Sale Of Family Home For $68 Debt

Capri Ramos refuses to believe she lost her home over a $68 dental bill. She still lives there. She still pays the mortgage. But a court ruling earlier this month may boot Ramos and her family from the home taken without her knowledge.

It started with baby-teeth cavities that landed Ramos' daughter in the dentist's chair in 1995. The $68 bill went unpaid. The Salt Lake City collection agency North American Recovery sued Ramos in 1995 over the dental bill. Ramos, who says she did not realize how dire the consequences might be, did not contest the suit. The Salt Lake County sheriff's department was ordered to sell Ramos' real estate to pay off the debt, which had reached $958 with interest and added fees.

Ramos had taken out a low-income homeowners loan from Salt Lake City to buy her Glendale split-level home for $51,000. It was sold at the sheriff's auction for $1,550.

More...

ICF International Blocked From Sending Katrina Victims To Collection Agency

ICF International, a private corporation, was contracted to administer the Road Home program by the Louisiana Recovery Authority. The Road Home program is the largest single housing recovery program in U.S. history funded with over 10 billion dollars of taxpayer money. It was created to help Homeless Katrina victims get back into a home quickly and fairly as possible.

For many however, things didn't work out that way. While ICF made millions, ICF has frustrated many Louisiana residents with long delays processing applications for the program, slow and inefficient hiring, delays and other problems with disbursement of awarded funds, and an inability to achieve state-mandated goals for application processing. And they're missing a lot of government money.

ICF said they can't account for millions because they paid some individuals too much for replacement homes due to their poor accounting standards and were going to turn program members over to a collection agency.

The state of Louisiana, doesn't buy it. If the ICF accounting standards are so bad, how do they know who owes them money if anyone?

Paul Rainwater, executive director of the Louisiana Recovery Authority, said the state will establish a panel to hear the cases of people believed by ICF to owe money. The panel will review the documentation of applicants who believe they owe no money, Rainwater said. The panel will not include a representative of ICF International.

"An 85-year-old woman who may have received too much, are we going to actually go out and collect money and have a collections agency hound that person?" said Rainwater. "I don't think that's the right thing to do, and neither did the governor think that's the right thing to do."

ICF and subcontractors stand to earn $912 million for running Road Home, though state audits have repeatedly found grant miscalculations and other mistakes.

Verizon Wireless Defends Another Federal Suit Over Fraudulent Collections

The often sued Verizon Wireless bill collectors are on the docket again.

The newest complaint, filed in Alabama federal court, asserts the No. 2 wireless service provider is destroying the credit of an otherwise uninvolved citizen.

Verizon Wireless is trying to collect more than $1,000 from Johnny Howard he does not owe, and is falsely reporting the alleged debt on his credit reports. Howard is an identity theft victim. After complying with Verizon Wireless’ demands to fill out a police report and send them a copy, he was turned over to a collection agency anyway. The collection agency later received the police report, according to the lawsuit, but the problem was not resolved. The overdue account remained on Howard’s credit reports, prompting him to contact TransUnion L.L.C. and Equifax. Equifax eventually removed the account; TransUnion did not. TransUnion is included in the complaint.

“This wrongful conduct has drastically impacted plaintiff’s credit score and credit worthiness and has caused him past and future monetary loss, past and future emotional distress, and other damages that will be presented,” the lawsuit states.

Pacific States Credit Owner Arraigned On 111 Counts

Jeff Allan McCoon owns Unifund, a debt buying company and Pacific States Credit, a collection agency. He uses Unifund to buy debts from other companies and then collects the debts through his collection agency, Pacific States Credit, by tracking down property possibly owned by the alleged debtors and filing liens against it. If the alleged debtors ever want to sell the property, they have to pay the liens first, whether they actually owe a bill or not.

So what? Many debt buyers operate on just such a business plan, leading their accounts to be known as zombie debts that never die. The difference in the Jeff Allan McCoon method, however, was not going to court to obtain a civil judgment but filing the liens anyway as if he had obtained a judgment.

The Sacramento County District Attorney's office is not amused.

More...

Sallie Mae Collections And Lending Under Investigation

If you are a former Sallie Mae collector or other employee, the James-Hoyer Law Firm would like you to contact them.

They are investigating the following issues on behalf of all Sallie Mae student loan borrowers:

Unfair collection practices

Discriminatory lending practices

Failure to timely disclose terms of loans

No choice in selecting your student loan lender

High or excessive interest rates

Unexplained increase in the balance of your student loans

Improper fees assessed on your student loans

Bill Collector Gets Fired, Switches To Bank Robbery

Hurst, TX police, acting on an informant's tip, have arrested James Patrick Fout, for bank robbery.

According to an arrest warrant affidavit, Fout had lost his job 10 days before the robbery for bad attendance at a Hurst collection agency.

Bank employees told police that a man walked into the bank and pulled out a sawed-off shotgun. The robber then ordered the tellers to get bundles of $100 and $50 bills, take the straps off and put them through a counter. The robber placed the bills inside a pipe before fleeing out a back door.

A man sitting on the bench in front of the building told police that he recognized the robber as someone who worked for a collection agency inside the building. Police discovered that Fout, who matched the robber's description, had been fired from that company a week earlier.

Tarrant County court records show that Fout has several arrests on suspicion of theft, theft by check, evading arrest and possession of drugs. Court records do not show why public records of several arrests on suspicion of theft, theft by check, evading arrest and possession of drugs would not disqualify someone from working at a collection agency with access to private information such as social security numbers and consumer credit reports.

Aurora, Gold & Associates Collection Agency Fined By NY AG

Aurora, Gold & Associates, a Western New York collection agency that engages in deceptive and abusive acts will pay $35,000 in penalties and costs perunder an agreement with the state Attorney General’s office.

Aurora, Gold & Associates engaged in illegal practices including collectors pretending to be attorneys, threatening consumers with non existant lawsuits and discussing private customer information with unrelated parties. "It is not acceptable for debt collection companies to harass consumers to the point where they overstep legal boundaries,” said Attorney General Andrew Cuomo in a public statement.

Violations by Aurora Gold included repeatedly calling consumers' family, friends and neighbors despite requests to stop calling. The Attorney General also found that Aurora Gold’s Web site contained statements that created the false impression that it was a law firm and could sue debtors.

In one instance, a collector – pretending to be an attorney – left a message on a consumer’s answering machine in which he toldher there was a “pending civil suit” against her.

In addition to paying $35,000 in penalties and costs, the agreement requires Aurora Gold to immediately institute a number of reforms to correct its current practices and to ensure that it will deal with debtors and third parties fairly and according to the law.

Although complaints to a state attorney general or the FTC are generally useless compared to a FDCPA lawsuit, the case of Aurora, Gold & Associates shows they can be sometimes worthwhile.

What To Do When You Have Been Sued By A Debt Collector

Indiana consumer attorney Robert Duff has a good article on what to do when you learn you are being sued by a debt collector. The post examines the problems debt collectors have in proving their cases and why it is important to seek representation even if you are knowledgeable about consumer rights.

"I understand that debt collection is a business, but that doesn't mean you can cut whatever corners you like in search of the almighty dollar. I've seen too many people's lives and well-being injured by greedy debt collectors. I don't think there is much of a difference between a debt collector who sues the wrong person because their practice is to attempt to collect debts without the appropriate documentation and a bus company who injuries a customer because they neglected maintenance on their bus."

More...

Recording Industry Association of America and MediaSentry Picked On The Wrong Mom

The Recording Industry Association of America (RIAA) and their attack dog, MediaSentry, don't get the press they deserve. There are a few watchdogs such as the Recording Industry vs People blog, but overall there are too few people who fight back against the illegal debt collection tactics and intimidation used by the RIAA to create much press.

So it's nice to see a substantial expose by BusinessWeek magazine on the successful fight of Tanya Andersen, a single mom who fought the illegal tactics in civil court and who is on the verge of a major victory.

Debt Collectors Told To Pursue Consumers For Bills Owed By Health Net and WellPoint

Last week, the Los Angeles City Attorney sued WellPoint, Inc.accusing them of illegally canceling health care coverage that left consumers with unpaid medical bills that were not their responsibility. A few weeks earlier, LA filed a similar suit against Health Net, saying the insurer illegally denied more than $35 million in claims.

Thousands of people were fraudulently denied benefits. Consequently, some or all of those consumers with canceled health care coverage have ended up in collections.

You might think the bill collectors going after sick people who don't really owe the money would stop harassing them. But you would be wrong.

In advice to medical debt collectors, Rozeanne Andersen, executive vice president and general counsel for ACA International, a pro bill collector lobbyist, said, “Debt collectors are hired to collect debt.” “Until a final judgment is determined, debt collectors can assume the debt is valid.”

The advice of the ACA is to sue, garnish, lien, etc., until the California courts order Health Net and WellPoint to pay the medical bills they fraudulently skipped out on.

Then what, Rozeanne? When Health Net and WellPoint pay the medical providers where will the thousands of sick people who gave in and paid the phony bills to your bill collectors go to get their money back? How will they get your phony collection accounts off their credit reports? How do they recover the jobs they weren't hired for or the apartments they couldn't rent or the homes they couldn't buy because your bill collectors artificially lowered their credit ratings?

Any bill collector re-victimizing the people who paid their insurance but received no coverage should be added to the Los Angeles City Attorney's suit, along with their cheerleader, the ACA.

Portfolio Recovery Collections Does Not Let The Facts Stand In Their Way

Q: Is anyone else getting bizarre calls from Portfolio Recovery? They say I owe on a Visa bill from 1993! I told them I did not and they keep calling with threats and insults. I told them to take me to court and get a judge to order me to pay after they prove the debt is real.

The calls started sometime last summer and this is the first I've heard that I owe money from 1993. Are these people are valid company or are they manufacturing /buying fake debt records? To what government agency can I report them to?

A: Everybody must get calls from Portfolio Recovery. They get sued all the time for violating consumer protections and there are hundreds of complaints against them on consumer websites. Not surprising for a debt buyer that places old and unproven collection accounts on credit reports without contacting the consumers to see if it is the right person. It is somewhat surprising their stock (NASDAQ:PRAA) has tanked to under $40.00 from over $60.00 though. How can you cheat so much and still not make money?

Even if the account was with the right person they cannot sue to collect a bill past the statute of limitations however. Nor can they place a 1993 bill on a credit report. Since they are a collection agency they have liabilities under the FDCPA which do not allow them to threaten to take action they cannot legally perform. They know all that but hope you don't.

Contact a consumer attorney in your area to have them review your Portfolio Recovery information. Portfolio Recovery might just need a cease and desist letter. Or they might need a lawsuit.

Midland Credit Management Buys Debt Cheap And Wins Big

Encore Capital Group, AKA: Midland Credit Management, spends lots of time and money defending itself in court for violating federal consumer protection regulations. So much so that some might wonder how they still make money.

Today's New York Times sheds some light on the profit strategy. Encore Capital Group, AKA: Midland Credit Management, buys alleged charged off debts for pennies on the dollar from original creditors with little documentation or proof of who really owes what if anything. Then they send the collections work (files with social security numbers, dates of birth and other private information) to India, where call centers of telephone debt collectors work for 25% of American wages calling tens of thousands of Americans an hour. If you don't pay much for the paper or the bill collectors you can be wrong a lot and pay a lot of fines in federal court and still get crazy rich.

As a bonus, if the Indian debt collectors can talk somebody into monthly payments on an alleged debt so old that it is beyond the statute of limitations, the statute of limitations clock is restarted, allowing Encore Capital Group, AKA: Midland Credit Management to file suit against the unsuspecting American consumer.

More...

Debt Collectors Mann Bracken and Creditors Receivable Management Named In Federal Class Action

The often sued Mann Bracken, LLC and Creditors Receivable Management, LLC have now been sued in a class action for violations of federal debt collection laws on behalf of clients of Hess Kennedy, the Campos Chartered Law Firm and the Consumer Law Center.

Hess Kennedy, the Campos Chartered Law Firm and the Consumer Law Center are all law firms providing services to consumers with a specific focus on evaluating the actions of creditors and credit collection agencies and their compliance with Federal and State consumer protection laws such as the Fair Debt Collection Practices Act, Fair Credit Billing Act and the Fair Credit Reporting Act.

If you or someone you know is the victim of illegal activities by Mann Bracken, LLC or Creditors Receivable Management, LLC contact David Lipman of Hess Kennedy, +1-954-510-7848.

Central Collection Bureau Collection Agency Exposes 700,000 ID's

A computer server containing Social Security numbers and other personal information of 700,000 people was stolen from Central Collection Bureau, a debt-collector, in what appears to be the largest computer security breach ever in Indiana.

The information includes customer-billing records for about 100 businesses. Central Collection Bureau collected overdue bills on behalf of utility companies, hospitals, medical and dental offices, window companies, water-conditioning companies and flower shops.

The computer server contained personal billing information was protected by two passwords but was not encrypted. The first employee arriving at work noticed the break-in and immediately called the Indianapolis Metropolitan Police Department, which investigated but has not found the server. The collection agency has notified companies whose billing records have been compromised.

The break-in is being investigated by IMPD and the Indiana attorney general's office.

New Jersey Taking On Abusive Debt Collectors

New Jersey legislators introduced a bill that regulates the practices of abusive debt collectors and gives state authorities the power to issue more significant fines for violations.

The bill, dubbed the New Jersey Fair Debt Collection Practices Act, goes further than the federal version, the FDCPA, by imposing rules on original creditors, not just third party collection agencies that are hired by creditors or buy debt at a discount.

The bill pending before the Assembly is aimed at prohibiting abusive, deceptive and unfair collection practices. A significant provision in the bill makes some willful acts of abuse, such as knowingly placing false information on a consumer's credit report and harming their credit rating, a violation of the Consumer Fraud Act, which could mean a fine of $10,000 or more to the offending debt collector.

Use A Validation Letter To Make The Collection Agency Prove Their Claim

Q: I received a statement from a collection agency stating that I owe a popular magazine company money for a subscription. When I filled out the post card for the magazine it had stated that I would get 4 free issues and then charged after that if I wished to keep the subscription. Well, it has been many months since I received the magazine and I never sent in the money b/c I decided against the subscription. Now all of a sudden I am getting a letter to collect the money.

My question is, can the magazine send me to collections? I can see if I received all the issues and never paid but that just isn't the case. I have just never heard of such a thing, being sent to collections for a magazine subscription. Is this just a scare tactic to get my money or is this true?

A: Until federal prosecutors start prosecuting companies such as the one you describe for mail fraud, those companies will keep sending fraudulent bills to their accomplice collection agencies to scam people out of money.

In order to keep the collection agency from placing the account on your credit report you need to reply to their demand letter and let them know you dispute the bill. The letter you need to send is called a "validation letter". You can Google the term to come up with examples. I like the one here.

After they are unable to come up with a signed contract or any enforceable legal agreement between you and the magazine company they must close the account and move on to the next victim who is less prepared to protect themselves.

If they do not close the account save all the paperwork and request representation on a FDCPA complaint from a NACA attorney in your area so you can have the collection agency stopped and recover the $1000 statutory damages from them in civil court.

Cell Phone Companies Using Fake Consumer Group To Protect Fraudulent Bills

If you receive a collection agency demand for an alleged cell phone bill find out when the service supposedly occurred. There is a two year statute of limitations on cell phone bills. It is likely any collection agency letter has language that makes the letter false, and subsequently, a FDCPA violation. If the alleged charges are over two years old contact a consumer attorney right away.

Many of the millions of alleged cell phone bills being pursued beyond the statute of limitations are for disputed services, fraudulent early termination fees, or the result of cell phone companies refusing to cancel accounts even though they are no longer under contract. In several states where legislation is pending that would outlaw the more egregious cell phone billing schemes, a "consumer protection" group has shown up to lobby against reform and tell legislatures that customers are happy with phony phone bills.

The fake consumer group with a website that's so bad it's funny is called MyWireless.org. A fact filled expose about their efforts to deceive and who is paying for MyWireless.org can be found here.

Sallie Mae's Tax Collection Company Under Fire

The House Ways and Means Committee passed legislation Friday that would end the Internal Revenue Service's private debt collection program, which is mostly conducted by Pioneer Credit, one of the third party collection agencies owned and operated by student loan giant Sallie Mae.

Critics of the program have long objected to turning over taxpayer information to private companies and subjecting taxpayers to the abuse associated with third party collection agencies.

Critics are also now attacking the fact that only the private collection agencies and not the government benefit from the taxes collected. A new government report shows the IRS plans to spend $7.5 million on the program in fiscal 2008 and projects that it will bring in approximately $30 million in revenue. But if the IRS instead invested that $7.5 million in its automated collection system, it would collect more than $146 million. And it's worse than that because Sallie Mae, doing business as Pioneer Credit, takes 30% of the tax money collected, making their performance for taxpayers even worse.

The House vote will have to be duplicated in the Senate to get Sallie Mae out of tax payer's government files. Already this week Sens. Byron Dorgan, D-N.D., and Patty Murray, D-Wash., sent a letter this week to new IRS Commissioner Douglas Shulman, seeking a review of the private debt collection program. "There is compelling evidence that the ...private tax collector initiative is a dismal failure," the senators wrote. "We feel confident that once you take a close look at the program, you will determine it is a waste of taxpayer dollars and use your authority to terminate it."

Collection Agency Countdown For HRC

The Clinton campaign's 8.7 million dollar debt total at the end of March has been widely discussed.

The University of California in Davis, however, is through discussing it. UC Davis sent their final demand letter today for over five thousand dollars in unpaid invoices related to a Bill Clinton campaign stop.

If the demand letter doesn't work the Clinton campaign will be turned over to a collection agency within 30 days, at which time their slogan may or may not change to "ready to be garnished on day one."

Columbia Credit Services Collection Agency Sued By San Francisco

The city of San Francisco has sued the collection agency Columbia Credit Services Inc., the National Arbitration Forum, and FIA Card Services alleging unfair and unlawful business practices.

The filing charges that the National Arbitration Forum is an “arbitration mill, churning out arbitration awards in favor of debt collectors and against California consumers.”

FIA issues credit cards to California consumers and Columbia Credit is a debt purchaser and collection agency based in Sacramento, Calif. The suit charges FIA and Columbia with participating in NAF’s “sham by forcing consumers into the NAF forum which they know to be biased in their favor.” The suit also charges Columbia with seeking attorney fees from consumers that lose an NAF arbitrated suit, “an unlawful business practice” that abets NAF’s activities.

The law suit found there were 33,933 consumer arbitration hearings in California involving consumer collections from January 2003 though March 2007. Of these, only 30 resulted in favor of the consumer.

More...

Ellis Crosby & Associates Collection Agency Ordered To Pay $1.3 Million

Four years after Ted Ellis Crosby was court-martialed by the Navy for being a drug dealer, he founded the Ellis Crosby & Associates collection agency. Last year, Crosby spent six months in a Florida county jail for being a felon in possession of a firearm. And also last year the state of Florida obtained a court order banning Crosby from conducting debt collections in Florida and sued his collection agency for $1.3 million after hundreds of complaints about Ted's illegal practices. You would think that would be enough to discourage Ted.

But you would be wrong.

Winning the 1.3 million (that Ted and his bill collectors will never pay) was a moral victory of sorts over Ted and his collectors for their:

1) Claiming or implying to be attorneys or government agents and threatening arrest or other legal action against consumers.
2) Claiming or collecting non existent or exorbitant debt amounts.
3) The use of harassing or intimidating techniques such as repeated phone calls or calls to neighbors, relatives and employers.

In one phone call taped by a consumer who was falsely accused of owing Ted money, one of Ted's bill collectors pretended to be talking on a walkie talkie coordinating a police raid on the consumer's home so he could take the single mom away from her two young children if she didn't pay $1000 by credit card right then.

However, since bill collectors are charged in civil court for their mail and wire fraud and police impersonations, instead of criminal court where they belong, Ted and his collectors were out and available during this suit by the state A.G. to set up another company, Bass Prelitigation Services, and go on about their organized crime business.

Now the Florida Attorney General is also pursuing a separate $1.3 million civil suit against Bass Prelitigation Services.

Meanwhile, if the past is a guide to the future, as he gets closer to losing the next million dollar suit, Ted Ellis Crosby will be inventing a new collection agency name and printing new letterhead for his next criminal operation.

CreditAssist Financial Offers Collections Disguised As Debt Settlement

CreditAssist Financial Services markets itself as a debt settlement company to consumers on sites such as this one and this one. They advertise themselves as "America's Number One Discount Debt Settlement Firm."

They collect the consumer's state of residence, email, and phone in advance just so they reduce debt more efficiently. Not because they are really a collection agency skip tracing for debt buyers. Right? You be the judge.

CreditAssists' consumer websites explain what their experience means to the consumer:
"CreditAssist's founders were former collection executives with some of the largest Credit Card Companies in the nation (Citibank, American Express, Bank of America, and Washington Mutual). This means that they know the inner workings of credit card companies, debt buyers and collection agencies, what they will agree to in terms of debt settlement and what they won't."

But CreditAssist is sending this press release to collection agency news sites like InsideARM (accounts receivables management) pitching a different service called DebtBuyerAssist.

The press release puts a different spin on what their experience means to bill collectors:
" CreditAssist was founded by collection industry veterans Rick Wittwer and Carmine Dorio. Our experience managing collection activities at most the major credit card issuers including Citi, American Express, BofA, and WAMU puts us in an enviable situation. We know the effectiveness and ineffectiveness of mail, collection call, and legal collection strategies. We also understand the costs associated with each of these strategies. No matter how much effort or expense is placed against the majority of accounts, debtors just won't respond, says Mr. Dorio."

"CreditAssist works with Debt Buyers to identify their unreachable populations and helps them develop both print and voice customized referral strategies. The debtors are offered an alternative to resolving the debt through one of their collectors by referring them to CreditAssist, an independent debt settlement company that represents the debtor to the debt buyer and offers similar settlement rates."

The consumer is charged a fee by CreditAssist to negotiate on their behalf. But if CreditAssist has sold the consumer's information to a debt buyer as DebtBuyerAssist and is also collecting a fee from the debt buyer that would be acting as a third party debt collector without disclosing it to the consumer they are supposedly representing. It would violate the FDCPA and every related civil or criminal statute ever enacted past present or future.

Anyone who has paid CreditAssist or even provided their contact information to http://www.debtsettlement4less.com or http://www.creditassistfs.com needs to contact a consumer attorney immediately.

AAFES Bill Collectors Ripping Off Soldiers And Veterans

Public Citizen, and California consumer lawyers Chandler Visher and Marie Appel, filed suit last year on behalf of Operation Desert Storm, veteran, Julius Briggs, and a class of soldiers and veterans nationwide because millions of dollars have been illegally taken from them by Pentagon bill collectors over military credit cards.

The Army and Air Force Exchange Services (AAFES) took money from military credit card users for expired debt and illegally inflated penalties and fees by deducting the money directly from service members' government benefits.

The government has moved to have the suit dismissed on sovereign immunity grounds, but at the U.S. District Court in San Francisco last week, plaintiffs' attorneys argued the case should go forward.

The AAFES illegally withheld more than $2,300 from the disability payments of lead plaintiff Julius Briggs and also hit him up with inflated interest rates and penalty fees. The withheld money caused Briggs to miss his housing payments and left him temporarily homeless.

The lawsuit seeks an injunction against further illegal bill collecting by AAFES and restitution of all funds illegally taken from soldiers and veterans.

NCO Financial Moving More Debt Collectors Off Shore

NCO Group, the world's most severely fined collection agency, based in Horsham, PA, wants to cut costs. Trying to obey the law sufficiently to avoid having to defend hundreds of state and federal suits at any one time is not the way they plan to do it however.

Victims of FDCPA violations can sue not only the tortfeasing collection agency for statutory damages, but can also sue the offending debt collector for their individual statutory liability. However, enforcing that right will become even harder. NCO is moving more of its debt collector positions offsh