On May 19, 2014, the Maryland Court of Appeals held that plaintiff-debt buyers that pursue judgments against defaulted debtors based on affidavits must produce certain documents that are “sufficient to pass muster” under the business records exception to the hearsay rule. Nevertheless, the high court further ruled that, once a small-claim action is contested and
FTC Settles $4 Million Enforcement Action Against California Debt Collectors
Asset Capital and Management Group (“Asset”), a debt collector based in Southern California, has agreed to a $4 million settlement with the Federal Trade Commission to resolve allegations that it extorted payments from consumers by using false threats. According to the FTC, Asset and its principals employed a vast network of related companies and used
Bill Passed in New Jersey to Regulate Service Contract Issuers
Legislation has been signed into law in New Jersey (Senate Bill 854) regulating service contracts as service contracts, not as insurance. The legislation takes effect July 16, 2014. While regulations applicable to service contracts vary in each state, often times service contracts are governed as insurance. The newly-adopted New Jersey framework creates regulatory
Legislation Introduced To Amend The FDCPA To Limit A Prevailing Defendant’s Ability To Recover Costs
On May 9, 2014, U.S. Representative Matt Cartwright introduced H.R. 4624 to amend the Fair Debt Collections Practices Act to prohibit a court from awarding costs to a prevailing defendant in the absence of a finding that an action was brought in bad faith.
This legislation is in response to the United States Supreme Court’s
Licensure Requirements Do Not Apply to Out-of-State Collectors that Have No Physical Location Within Indiana
The Indiana Court of Appeals addressed an issue of first impression by holding that out-of-state companies must have an Indiana location before they need to obtain a license under Indiana’s Uniform Consumer Credit Code (IUCCC). Therefore, a collection agency with its principal place of business in another state is only required to obtain a license
FTC Enforcement Action Recovers More Than $3.3 Million for Consumers and Agreement to Permanent Ban from the Debt Collection Business
The two principal owners of Rincon Debt Management – Jason R. Begley and Wayne W. Lunsford – will surrender more than $3.3 million worth of assets that will be used to provide refunds to victims under a settlement with the Federal Trade Commission. In addition to the permanent ban from the debt collection business
CFPB Launches Regulation Z on eRegulations Platform
The CFPB posted Regulation Z, which implements the Truth in Lending Act, on its eRegulations platform. The posting brings together all materials related to the regulation on a single website. Users of eRegulations can view the currently effective regulation text, search past and present versions of regulations, compare two versions of the regulation,
CFPB Issues New (TILA-RESPA) Guidelines
The Consumer Financial Protection Bureau recently issued guidelines aimed to increase clarity regarding the Truth in Lending Act-Real Estate Settlement Procedures Act (TILA-RESPA) integrated mortgage disclosure rule. The CFPB stated that the “TILA-RESPA Integrated Disclosure Rule Small Entity Compliance Guide” makes mortgage disclosures easier for consumers to understand and use, while also helping
CFPB Issues Proposed Amendments to Mortgage Rules under Regulation Z
The Consumer Financial Protection Bureau has issued a rule containing proposed amendments to its mortgage rules under the Truth in Lending Act (Regulation Z). The proposed rule was published in the Federal Register on May 6, 2014. The proposal includes amendments to certain rules that were issued in January 2013 and went into effect in
Court Finds Uncapped Punitive Damages Available Under the FCRA Precludes Dismissal When Offer of Judgment Not Accepted
On April 7, 2014, the United States District Court in the Eastern District of Virginia declined to dismiss a class action under the Fair Credit Reporting Act as moot because it could not conclude with certainty that an offer of judgment under Rule 68 afforded complete relief.