Consumer Financial Services Law Monitor

Consumer Financial Services Law Monitor

monitoring the financial services industry to help companies navigate through regulatory compliance, enforcement, and litigation issues

Debt Buyers & Collectors

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Supreme Court Rules That Filing a Proof of Claim on a Time-Barred Debt Does Not Violate the FDCPA

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, Featured Posts
United States Supreme CourtOn May 15, 2017, the United States Supreme Court ruled that the Eleventh Circuit erred when it found a debt buyer liable under the Fair Debt Collection Practices Act for filing proofs of claim in bankruptcy on debts that had become time-barred. A copy of the Court’s opinion can be found here. Background In Johnson… Continue Reading

Spokeo Strikes Again: Fourth Circuit Reverses and Dismisses $12 Million FCRA Class Action on Spokeo Grounds

Posted in ALL CFS Blog Entries, Background Screening, Credit Reporting & Data Brokers, Cyber Security, Information Governance & Privacy, Debt Buyers & Collectors, Featured Posts
Credit report with scoreIn one of the most significant post-Spokeo decisions to date, the Fourth Circuit unanimously reversed and dismissed a nearly $12 million Fair Credit Reporting Act (“FCRA”) class action judgment, finding plaintiff, Michael T. Dreher, lacked Article III standing to bring his claims. The decision provides much needed clarity from the Fourth Circuit on the viability… Continue Reading

U.S. Supreme Court Rejects “Meaningful Attorney Involvement” Case

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, Featured Posts
GavelThe United States Supreme Court declined a petition for writ of certiorari by a consumer regarding a collection letter on law firm letterhead with attorney signatures.  The ruling of the United States Court of Appeals for the District of Columbia in Tawanda Jones v. David Sean Dufek, Sr. was left in place, holding that a… Continue Reading

New WVCCPA Amendments are Enacted by Governor Justice

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers, Debt Buyers & Collectors, Mortgage Lenders & Servicers
Senate Bill No. 563 amends several provisions of the West Virginia Consumer Credit Protection Act (WVCCPA). The Bill passed the West Virginia Senate and the House of Delegates with high approval margins, and was signed into law by Governor Jim Justice on April 21, 2017. These amendments to the WVCCPA will have an impact on… Continue Reading

Supreme Court Wavers During Oral Arguments in FDCPA Case That May Upend Entire Industry

Posted in ALL CFS Blog Entries, Auto Finance, Debt Buyers & Collectors, Featured Posts
Decorative Scales of Justice in the CourtroomOn April 18, the United States Supreme Court heard long-awaited oral arguments in a case that addresses the fundamental issue of the definition of a “debt collector” under the Fair Debt Collection Practices Act.  The Supreme Court’s decision will resolve an existing Circuit split on whether an entity that purchases defaulted debts and then attempts… Continue Reading

Favorable Spokeo Decision Handed Down in Eastern District of Virginia

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On April 17, the Eastern District of Virginia dismissed sua sponte a suit against a collection agency alleging that the debt collector failed to properly update the plaintiff consumer’s credit report, thereby violating the Fair Debt Collection Practices Act.  Relying on the U.S. Supreme Court’s decision in Spokeo, Inc. v. Robins, the Court concluded that… Continue Reading

CFPB Cracks Down on Collection Firm for Alleged Misrepresentation of Attorney Involvement

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
The Consumer Financial Protection Bureau is continuing its pursuit of third-party collection law firms it believes misrepresent to consumers the level of attorney involvement in their collection practices. On April 17, the CFPB filed suit in the Northern District of Ohio against Weltman, Weinberg & Reis Co., L.P.A., for allegedly misrepresenting in millions of collections… Continue Reading

District Court Denies Motion to Dismiss Over Allegedly Misleading Statement About Time-Barred Debt

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On March 31, the U.S. District Court for the Southern District of Indiana denied a motion to dismiss where a collection letter sent to the plaintiff stated, “[b]ecause of the age of your debt, our client will not sue you for it,” when in fact there was no possibility of suing on the debt because… Continue Reading

District of New Jersey Tosses FDCPA Putative Class Action

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
The United States District Court for the District of New Jersey recently dismissed a putative Fair Debt Collection Practices Act class action against defendant debt collector, Retrieval-Masters Creditors Bureau, Inc. (“RMCB”), over allegedly violative letters dealing with unpaid E-ZPass tolls.  A copy of the opinion can be found here. As background, plaintiff Thomas E. St.… Continue Reading

Ninth Circuit Reverses District Court’s Dismissal of Putative TCPA Class Action

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy, Debt Buyers & Collectors
The Ninth Circuit recently reversed a lower court’s dismissal of a Telephone Consumer Protection Act (TCPA) putative class action against Adir International, LLC (“Adir”), holding that Plaintiff Ned Flores (“Flores”) sufficiently alleged that Adir used an automatic telephone dialing system (“ATDS”) to send text messages to Flores. According to the First Amended Complaint, Adir is… Continue Reading

TCPA Defendant Settles Class Claims on Individual Basis Following Counterclaims for Harassment and Racketeering

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers, Debt Buyers & Collectors
BrandRep, the defendant in a Telephone Consumer Protection Act putative class action lawsuit pending in the United States District Court for the Central District of California, recently settled putative nationwide class claims on an individual basis, resulting in dismissal of the case.  The settlement came on the heels of BrandRep’s assertion of counterclaims that put… Continue Reading

Offshore Call Center Bill Reintroduced in Congress

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
Congress recently reintroduced a bill titled United States Call Center Worker and Consumer Protection Act of 2016, which attempts to deter companies from employing offshore call collection centers.   The bill would require a business that employs 50 or more call center employees to notify the Department of Labor at least 120 days before relocating such… Continue Reading

TCPA Class Action Dismissed Based on Lack of Vicarious Liability

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy, Debt Buyers & Collectors
The United States District Court for the Southern District of California recently granted summary judgment in favor of defendant United Student Aid Funds, Inc. (“USAF”) in a Telephone Consumer Protection Act class action, holding that the plaintiff had failed to prove that USAF is vicariously liable for the acts of its third party servicers.  In… Continue Reading

High Call Volume Not Necessarily a Violation of FDCPA or Rosenthal Act

Posted in ALL CFS Blog Entries, Auto Finance, Credit Reporting & Data Brokers, Debt Buyers & Collectors
In Hinderstein v. Advanced Call Ctr. Techs., No. 15-100017 (C.D. Cal. Feb. 27, 2017), a case alleging violation of the federal Fair Debt Collection Practices Act and California’s Rosenthal Fair Debt Collection Practices Act before the United States District Court for the Central District of California, the Court found that a relatively high call volume… Continue Reading

CFPB Sues Law Firms for Debt Relief Fees Disguised as Bankruptcy Fees

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
The Consumer Financial Protection Bureau recently sued three law firms in the United States District Court for the Central District of California for collecting advance fees from consumers seeking debt relief.  CFPB Director Richard Cordray stated that “[t]he defendants exploited consumers who were already suffering financial difficulties by tricking them into paying steep, illegal fees.”… Continue Reading

FTC Settles with Nationwide Debt Relief Provider

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On February 27, the Federal Trade Commission filed a stipulated order, which includes a $9 million judgment, against another debt relief provider, United Debt Counselors, LLC, its owners, and officers (collectively “United”) for violating the FTC Act and the Telemarketing Sales Rule.  This serves as another warning from the FTC that debt relief companies need… Continue Reading

DOJ Issues New Guidance on Corporate Compliance Programs

Posted in ALL CFS Blog Entries, Auto Finance, Debt Buyers & Collectors, Mortgage Lenders & Servicers
On February 8, 2017, the Criminal Division of the U.S. Department of Justice quietly issued new guidance on corporate compliance programs for companies implicated in misconduct. Specifically, the Criminal Division posted a set of “important topics and sample questions that the Fraud Section has frequently found relevant in evaluating a corporate compliance program” to the… Continue Reading

Debt Collector Granted Summary Judgment in FDCPA Case

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
Plaintiff Yvette Palmer filed a Fair Debt Collection Practices Act case against defendant debt collector, Enhanced Recovery Company (“ERC”), for ERC’s alleged concealment of its identity as a debt collector while attempting to collect a debt and to obtain information to collect debt.  ERC filed a motion for summary judgment, arguing that Palmer’s claims are… Continue Reading

FTC Issues Letter to CFPB on 2016 Debt Collection Efforts

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On February 13, the Federal Trade Commission sent a letter to Consumer Financial Protection Bureau director Richard Cordray summarizing its 2016 debt collection activities for inclusion in the CFPB’s annual report to Congress on the Fair Debt Collection Practices Act. In its letter, the FTC describes “its aggressive law enforcement activities against abusive, unfair, and… Continue Reading

Validation Notice Including Request for Payment and Identifying Creditor by Acronym Does Not Violate FDCPA

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
The United States District Court for the Southern District of California recently dismissed all of a plaintiff’s claims in the putative class action Matthew Stuppiello v. Southwest Credit Systems, L.P.   The Court held that a validation notice does not violate the Fair Debt Collection Practices Act by including a request for payment “and explain[ing] that… Continue Reading

CFPB Takes Action Against Law Firm Debt Collectors for Lack of Meaningful Involvement

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, State Attorneys General, CFPB, & FTC
On January 9, 2017, the Consumer Financial Protection Bureau (CFPB) entered a Consent Order against Works & Lentz, Inc., Works & Lentz of Tulsa, Inc., two medical debt collection law firms, and their president, Harry A. Lentz, Jr., for the defendants’ violations of the Fair Debt Collection Practices Act (FDCPA) and the Furnisher Rule (Regulation… Continue Reading

Join Us on February 22 for a Complimentary Webinar on Bankruptcy and Debt Collection – Latest Trends and Developments

Posted in ALL CFS Blog Entries, CFS Events, Debt Buyers & Collectors
Microphone on Stage SizedDebt collection is becoming an increasingly regulated industry and the CFPB has signaled its intention to further regulate the industry by extending regulations to first party creditors.  Please join Troutman Sanders Partner David N. Anthony and Of Counsel Andrew B. Buxbaum for a complimentary webinar for a discussion of debt collection issues including how debt… Continue Reading

West Virginia Federal Court First Reconsiders, Then Restricts, Vicarious Liability for TCPA Claims in MDL

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
The United States District Court for the Northern District of West Virginia recently reversed its position on vicarious liability under the Telephone Consumer Protection Act, granting summary judgment for defendants UTC Fire and Security Americas Corporation, Inc. and Honeywell International, Inc. in multi-district litigation.  In doing so, the court joined the growing list of federal… Continue Reading

Student Loan Servicer Agrees to $17.5M TCPA Class Action Settlement

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy, Debt Buyers & Collectors
On January 26, the United States District Court for the Southern District of Indiana granted preliminary approval of a $17.5 million Telephone Consumer Protection Act class action against Navient Solutions Inc.  According to the original Complaint, plaintiff Randy Johnson received multiple telephone calls on his cell phone from Navient, a student loan servicing and collection… Continue Reading