Debt Collectors

Greenspoon Marder P.A. Class Action

The Holland Law Firm, together with Andrew Delaney of Martin & Associates, P.C., Vermont, filed a putative class action against law firm Greenspoon Marder P.A. If you have any questions about this case please contact us.

What is the case about?

The lawsuit alleges that Greenspoon collects debts arising from timeshares. Greenspoon revealed private financial information about people alleged to owe money on timeshares to third parties, in violation of Federal and Vermont law.

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For Nonprofit Hospitals Who Sue Patients, New Rules

By Paul Kiel, ProPublica. Originally posted here. Republished here under a Creative Commons license.

Non-profit hospitals get big tax breaks for providing care for patients who can’t afford it. Under new IRS rules these hospitals must take extra steps to inform poor patients they may qualify for financial assistance.

Last month, ProPublica and NPR detailed how one nonprofit hospital in Missouri sued thousands of lower income workers who couldn’t pay their bills, then seized their wages, all while enjoying a big break on its taxes.

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Can I Sue the I.R.S for Abusive Debt Collection?

Private debt collectors are subject to a variety of laws policing their collection of private debts. The Fair Debt Collection Practice Act (FDCPA) imposes clear and strict requirements on debt collectors – such as preventing them from shaming consumers into payment by publishing the names or calling their parents, preventing them from lying to consumers or threatening them with illegal behavior.

However, FDCPA applies only to consumer transactions and does not cover matters such as tax debts. Boyd v. J.E. Robert Co., 765 F.3d 123 (2d Cir. 2014); Beggs v. Rossi, 145 F.3d 511 (2d Cir. 1998). Federal employees are also specially exempted from the FDCPA. 15 U.S.C. § 1692a(6)(C).

So, what’s left to protect taxpayers?

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Frederick J. Hanna Associates To Pay $3.1 Million And Stop Filing Suits Without Proof

A proposed Consent Order has been filed in the CFPB’s enforcement action against Frederick J. Hanna Associates. This was the first enforcement action by the CFPB directly against a collection law firm and was the subject of a vigorous defense by Hanna and much comment in the trade press. Hanna lost its motion to dismiss in July 2015, made an unsuccessful motion for an interlocutory appeal and discovery was ordered to proceed.

The case attracted a lot of attention: from the Wall Street Journal to trade publication InsideARM which said that “[t]he case should be front and center for all law firms practicing in this space“. In light of the excitement about the case, the bottom line of the Consent Order is, rather disappointing: Hanna is to pay $3.1 million in penalties to the CFPB and agrees to injunctive relief(all without admitting any of the CFPB’s allegations). There is no relief for consumers targeted by Hanna – that is presumably left to private law suits.

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Bad Debt Collectors and Their Prey: NYT Editorial Board

An excellent November 17, 2015 New York Times editorial highlights several widespread abusive collection practices, and calls on states to update collection and garnishment laws to better protect consumers from predatory debt collectors.  “For example, companies that buy up consumer debt for pennies on the dollar from creditors and then try to recover the full debt for themselves often pursue people for debts that are too old to be legally collected or fake documents intended to show that the debt is authentic.”  For years, consumer advocates have been pointing out these types of abuses.  Perhaps the NYT coverage will lead to greater public awareness and thereby subject collectors and the court system to greater scrutiny.  The editorial is reprinted in full below:

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