The largest debt collection agency in another state has agreed to pay $1 million in a consent judgment entered into with the state’s attorney general’s office. According to the lawsuit, the debt collectors had filed massive amounts of lawsuits per year, tens of thousands of them, which later proved to be inaccurate or unsubstantiated. They were accused of filing over 200,000 lawsuits in that state. False collections from a debt collector have become a problem in many states, including Florida.
According to the suit, the debt collection firm had issued demands on consumers for debts that they did not owe. The firm had no proof that these debts existed or that they were owed by the people who they pursued. They are accused of filing false pleadings, and for demanding payment for debts which had been dismissed or were outside of the statute of limitations. The firm also took payments from sources that were legally exempt, such as a person’s Social Security check.
The evidence was taken from spreadsheets that had been provided by national companies that purchase debts. These companies buy debt from a company at a lower cost, and then seek sufficient funds from the debtor for enough payment to make a profit. The collection firm has agreed to several stipulations other than the $1 million, such as obtaining proof that a debt is owed before attempting collection, informing the debtor when his or her income is exempt, having an attorney look over all court filings and ceasing to pressure debtors who cannot pay.
Anyone who is being harassed by a debt collector for a debt that he or she does not owe can contact a bankruptcy lawyer for advice on how to proceed. In all states, including Florida, creditor harassment is against the law, thanks to the federal Fair Debt Collection Practices Act. In fact, a debt collector can be sued for such practices. A bankruptcy attorney can also help the individual assess any financial issues and create a plan to achieve economic stability once again.
Source: jdsupra.com, “Debt Collection Firm Enters Consent Judgment for $1 Million in Restitution with Massachusetts AG“, Aug 1, 2017