On November 12, 2014, the American Bar Association issued Formal Opinion 469, regarding the practice of some States’ Attorneys allowing debt collectors to use their letterhead for a fee. Here is what they concluded: Read more
Abusive debt collectors falsely threatened Maryland and other consumers with arrest and jail. Now the owner of the firm, together with six of his employees, are under arrest for making false threats of arrest to consumers and pretending to work for the federal government. A press release by the FBI and U.S. Attorney for the… Read more
Robo-signing of affidavits and other legal documents used in Maryland foreclosures has led to the predictable scenario where long after the foreclosure was approved, junk debt buyers are now seeking foreclosure deficiency judgments on what was the difference between the amount of the mortgage and the price fetched at the foreclosure sale. Most participants in… Read more
Usually, zombie debt is associated with unscrupulous debt collectors, trying to collect debts beyond the statute of limitations or which were discharged in Bankruptcy. However, according to Jessica Silver-Greenberg at the New York Times’ Dealbook, four major banks are under investigation: JPMorgan Chase, Bank of America, Citigroup and Synchrony Financial (formerly GE Capital). Read more
Two debt brokers (businesses which buy junk debt, then sell it to other junk debt buyers) were sued by the FTC earlier this year for posting on the internet private personal financial information about individual consumers for public view, as part of their attempts to market portfolios of junk debt to JDBs. Read more
Auto-lenders have found new weapons to use against consumers believed to be in default: ignition interruption devices and GPS tracking. These weapons allow creditors to prevent consumers’ cars from starting. Jessica Silver-Greenberg (author of an outstanding series of articles on debt collection, here) and Michael Corkery report here. Read more
The CFPB has released this report about debt collection complaints made by older consumers (those identifying themselves as 62 or older). The report reveals that older consumers suffer similar collection problems to consumers generally. Nearly 50% of complaints are about the collection of debts that older consumers do not owe, and in nearly 30% of… Read more
NPR and ProPublica have been studying the use of garnishments to collect consumer debt, with the help of payroll firm ADP. Garnishment occurs when a court orders a judgment debtor’s employer to turn over some of the debtor’s paycheck to a creditor, or orders a bank to turn over the contents of a debtor’s accounts… Read more
The Sixth Circuit Court of Appeals has decided Stratton v. Portfolio Recovery Associates, a proposed FDCPA class action, which grew from a typical debt buyer lawsuit. Read more
The CFPB’s Fall 2014 supervisory highlights, covering supervisory activity between March and June, points to failings by student loan servicers and debt collectors. The highlights identified six failings by student loan servicers, including misleading statements to consumers and telephone harassment. Debt collectors’ misconduct included charging illegal convenience fees to consumers paying by credit card, false… Read more