MA Consent Order with Debt Buyers Over Debt Collection Tactics
The Massachusetts Attorney General entered into a consent order with a group of debt buying companies and their individual owner over alleged unlawful debt collection practices.
The state asserted that the companies made misrepresentations to consumers and attempted to collect debts in an unfair, deceptive, or unreasonable manner. Among other things, the defendants allegedly:
- Seized exempt vehicles from consumers;
- Used vehicle seizures as a means of persuasion rather than satisfaction;
- Engaged in unlicensed debt collection and the unauthorized practice of law;
- Claimed and overstated prejudgment interest in court filings;
- Collected debts outside of the applicable statute of limitations; and
- Initiated debt collection communications with consumers in excess of legal limits.
Under the consent order, the companies and their owner are barred from engaging in any future debt collection activity in Massachusetts and will waive further collection of approximately $52.8 million in outstanding debt owed by Massachusetts consumers. The defendants also agreed to a penalty of $650,000, however payment of this amount is suspended due to their current financial condition. The defendants will only need to pay the penalty if the state determines that the financial disclosures and related information which the defendants provided to the state were not truthful, accurate, or complete, or if they violate any of the other terms of the consent order.
