Harassment
Complaint
supergirl
Country: United States
This company is very discietful. They will call you twenty times a day!! They will use different 800's and private call to hide their number and who they are.Even after you make arrangments, they continue to call 2 times per hour, using different numbers and leaving messages on top of this!! This harassment!! And they also threaten others that answer you phone that they will call your work until you answer!! When I took this out, I thought that they was legimate loan company come to find out later that they are cash advance facility. The will not tell you anything until after you sign everything and they do it such a hurry, you can not go over everything until after it is all said and done.
Comments
ANYONE who tries to rush you thru agreeing to a contract is probably trying to slip something past you. That is not a time for manners. Just rip it into tiny bits and walk out the door.
Cash call appears to be based in southern California. Contact the California Attorney General's office and file a complaint.
Thursday, February 07, 2008
Ninth Circuit: Private Debt Collectors Under Contract With Prosecutors Are Not Shielded by Sovereign Immunity
by Deepak Gupta
Yesterday, the U.S. Court of Appeals for the Ninth Circuit, in an opinion by Judge Marsha Berzon, ruled that American Corrective Counseling Services (ACCS), the nation's largest operator of "check diversion" programs, may not shield itself from a consumer class action over its aggresive debt-collection practices by invoking the doctrine of state sovereign immunity. (Information about the case, including the briefs and opinion, is available here.)
I've blogged here before about so-called check diversion companies -- private debt collectors that use their contracts with prosecutors to gin out collection demands, on official prosecutor stationary, threatening consumers who have written bad checks with criminal prosecution or jail unless they pay exorbitant collection fees. Passing a bad check is only a crime where there's knowing and intentional fraud, but these companies demand fees regardless of whether a crime has been committed. It's a lucrative and shady business that essentially criminalizes civil debt collection.
Judge Berzon's opinion is the most thorough and scholarly treatment to date on the question of private entities and sovereign immunity. In a sweeping rejection of ACCS's arguments, the Ninth Circuit characterized sovereign immunity as “strong medicine” that should be carefully limited, especially in the case of for-profit corporations that are not democratically accountable to the public. Quoting the philosopher Gilbert Ryle, the court called the argument that a private company could enjoy sovereign immunity a “category error,” like “inquiring into the gender of a rock or into which day of the week is reptilian.”
Continue reading "Ninth Circuit: Private Debt Collectors Under Contract With Prosecutors Are Not Shielded by Sovereign Immunity" »
Posted by Deepak Gupta on Thursday, February 07, 2008 at 04:10 PM in Consumer Litigation, Debt Collection | Permalink | Comments (1) | TrackBack (0)
Wednesday, January 09, 2008
Debt collectors in the US may not be so bad, after all
Not compared with debt collectors in India, anyway.
Vinod Kumar was sitting in a friend's car listening to the radio one evening last January when a stranger appeared, yanked him from the vehicle and beat him with an iron bar.
To collect a debt, that is. Here in the good ol' USA, debt collectors still rely on intimidation and mental abuse, which seems quaint and peaceful in comparison with the debt collectors in India. And get this for chutzpah: after a court awarded Mr. Kumar $140,000 for the beating he suffered, the bank who hired the thug (or "goonda") collection agency appealed the award as excessive.
While the 21-year-old college student lay bleeding in the parking lot, the assailant sped off with the tiny silver hatchback. But this was no ordinary mugging: Mr. Kumar's attacker was a /goonda/ -- a thug -- working on behalf of one of India's largest banks.
Ruling on Mr. Kumar's case in November, the Delhi State Consumer Commission fined ICICI Bank, India's largest privately owned bank by market value, almost $140,000 for what a judge called "the grossest kind of deficiency in service and unfair trade practice." ICICI Bank has appealed the decision to the Delhi High Court, arguing that the consumer court doesn't have the authority to impose such a large fine and that the collection agency should be held responsible for the attack, not the bank. It has also fired the collection agency responsible for the attack.
Read the rest of the WSJ article.
[crosspost: Caveat Emptor]
Posted by Sam Glover on Wednesday, January 09, 2008 at 05:10 PM in Debt Collection | Permalink | Comments (0) | TrackBack (0)
Thursday, December 27, 2007
Robert Hunt Primer on Debt Collection
Robert M. Hunt on the Fed has written "Collecting Consumer Debt in America" available at
http://ssrn.com/abstract=993249. Here's the abstract:
Why should economic scholars study the consumer debt collection process? First, the cost and effectiveness of the collections process has implications for the pricing and availability of consumer credit. Second, changes in technology and the structure of credit markets have transformed the collections industry. Small mom-and-pop operations are increasingly being replaced by firms operating nationally, collecting on billions of dollars in bad debt purchased from
creditors.
This article explores how creditors and their agents attempt to collect past-due consumer debt, particularly unsecured debt.Creditors have a number of remedies open to them, but their
effectiveness is limited by the fact that consumers can file for bankruptcy. Even outside of bankruptcy, consumers enjoy a variety of legal protections, including some they may not be aware of.
Posted by Jeff Sovern on Thursday, December 27, 2007 at 03:26 PM in Debt Collection | Permalink | Comments (0) | TrackBack (1)
Friday, December 21, 2007
Foreclosures over the Holidays
by Deepak Gupta
Last month, I mentioned a case in which Public Citizen, together with Baltimore-based Civil Justice Inc., is challenging the constitutionality of mortgage foreclosure notice procedures in Maryland. This morning, the Washington Post ran a very moving profile of our client, Joyce Griffin. The story recounts how Joyce, a first-generation homeowner, saved up her whole life to buy a house, was tricked into a predatory refinanced mortgage with the now-defunct Ameriquest, and never learned until it was too late that her home was put up for sale at a foreclosure auction on the courhouse steps. She first found out that she had lost her house when she and her young daughter returned home one day and found a handwritten note that had been tacked onto the front door by the investor who bought the house. The lawyers that conducted the foreclosure proceedings never tried to personally serve Ms. Griffin (the procedure that would have been followed in virtually any other civil proceeding, even an action to collect a very small debt), never posted the house, and did nothing when the certified-mail notices they sent were returned undelivered. I'll be presenting oral argument in Ms. Griffin's case in the Maryland Court of Appeals in Annapolis on January 8.
Posted by Deepak Gupta on Friday, December 21, 2007 at 03:34 PM in Consumer Litigation, Debt Collection, Predatory Lending | Permalink | Comments (1) | TrackBack (0)
Friday, November 02, 2007
Discharged Debts That Won't Die
by Deepak Gupta
BusinessWeek.com has just posted an interesting investigative report, titled "Prisoners of Debt," by reporters Robert Berner and Brian Grow. The piece focuses on how big lenders and credit card companies keep squeezing money out of consumers whose debts have been discharged in bankruptcy, and on the selling and buying of those discharged debts. "In a financial version of Night of the Living Dead," the article recounts, "debts forgiven by bankruptcy courts are springing back to life to haunt consumers. Fueling these miniature horror stories is an unlikely market in which seemingly extinguished debts are avidly bought and sold." Discharged debts continue to show up consumers' credit reports and, in many cases, consumers end up paying the discharged debts anyway, just to make the creditors' go away. So much for bankruptcy as a fresh start.
Update: Over at the Credit Slips blog, law professor Bob Lawless has some thoughts on the BusinessWeek report.
Posted by Deepak Gupta on Friday, November 02, 2007 at 05:02 PM in Debt Collection | Permalink | Comments (1) | TrackBack (0)
Eleventh Circuit: Debt Collectors Masquerading as Prosecutors Don't Get Sovereign Immunity
by Deepak Gupta
A front-page article in the San Jose Mercury News earlier this week and a recent AP story both reported on a practice I've previously blogged about here: private debt collectors that rent out a prosecutor's name and authority, which they use to threaten consumers who have written bad checks with criminal prosecution and jail unless they pay exorbitant collection fees. The threats are made without regard to the facts of the case (in the vast majority of cases, there's no criminal intent), and the revenues are split with the prosecutors. Assuming they're subject to suit, these companies' practices violate virtually every section of the Fair Debt Collection Practices Act.
The threshold question, however, is whether these companies are above the law. They have argued that they're entitled to blanket immunity from suit--that they get derivative sovereign immunity by virtue of their contractual relationship with the government. In one case, a Florida federal district court bought that argument, extending the doctrine of state sovereign immunity far beyond previously existing law. In a second case, a California federal district court disagreed. In separate appeals, Public Citizen's Consumer Justice Project has been defending the California decision and urging reversal of the Florida decision.
Yesterday, the U.S. Court of Appeals for the Eleventh Circuit (a notably conservative court on immunity issues, and the only federal appeals court ever to have sustained a state sovereign immunity defense by any private corporation) reversed the Florida district court and rejected the immunity defense raised by a company called American Corrective Counseling Services (ACCS). In its decision, the appeals court found that attorneys in the prosecutors’ offices do not review cases before ACCS threatens consumers with prosecution, and that the prosecutors exercise virtually no control over ACCS. Sovereign immunity, the court said, “has never been held to apply simply because an independent contractor performs some government function.”
The decision has potentially far-reaching implications for holding all sorts of government contractors--from private prisons to Blackwater--accountable in the federal courts. And both in its analysis of the Eleventh Amendment issue and its characterization of the program itself, the decision in many ways provides a roadmap for arguing that these types of debt collectors should be held liable under both state and federal consumer protection law. [press release] [case info and briefs]
Continue reading "Eleventh Circuit: Debt Collectors Masquerading as Prosecutors Don't Get Sovereign Immunity" »
Posted by Deepak Gupta on Friday, November 02, 2007 at 03:36 PM in Class Actions, Consumer Litigation, Debt Collection | Permalink | Comments (0) | TrackBack (0)
Tuesday, July 31, 2007
Senate Hearing Today on Credit Repair Organizations and Telemarketing Fraud
The Senate Commerce Committee is holding a hearing at 2:30 this afternoon on telemarketing (specifically, the Do-Not-Call list and proposals to improve it, as well as telemarketing fraud aimed at seniors) and the Credit Repair Organizations Act (CROA).
The CROA may not be the best-known federal consumer protection statute, but it's an important one. It was passed in 1996 to address abuses by credit repair organizations, outfits that take money for services that will purportedly improve a consumer's credit score. The legislation was the result of a rare alliance between consumer advocates and credit reporting agencies, who were getting swamped with dispute letters generated by credit repair services. The Act requires certain disclosures, provides for a 3-day right to cancel, prohibits the acceptance of payment before services are performed, and prohibits any person--not just "credit repair organizations"--from engaging in certain deceptive acts. (The statute has thus been applied to lawyers, debt collectors, and payday lenders in certain circumstances.) CROA has strong civil liability provisions, including punitive damages.
Connnecticut consumer advocate Joanne Faulkner, who an expert on bringing cases under the CROA, is testifying this afternoon on behalf of the National Association of Consumer Advocates, the National Consumer Law Center, U.S. PIRG, and Consumer Federation of America. Joanne will suggest a number of improvements to CROA, including a clear ban on mandatory binding arbitration, distant forum, and class action waiver clauses, as well as a provision allowing for injunctive relief. You can read her written testimony here. The other witnesses are Lydia Parnes (Director of the Bureau of Consumer Protection, FTC), Richard Johnson (AARP), Jerry Cerasale (lobbyist for the telemarketing industry), Robin Holland (lobbyist for Equifax), and Steve St. Clair (Iowa Attorney General's office).
Posted by Deepak Gupta on Tuesday, July 31, 2007 at 11:06 AM in Consumer Legislative Policy, Credit Reporting & Discrimination, Debt Collection | Permalink | Comments (1) | TrackBack (0)
Monday, July 23, 2007
Elizabeth Warren on the Relationship Between Our Broken Health Care System and Personal Bankruptcy
Professor Elizabeth Warren testified last week before the Judiciary Committee of the U.S. House of Representatives on the tragic relationship between our failing health care system and the rise in personal bankruptcies. As Prof. Warren puts it: "Since 2000, an estimated five million families have filed for bankruptcy in the aftermath of serious medical problems. The current health care finance system is bankrupting hard-working, play-by-the-rules American families." Prof. Warren's testimony, as well as materials related to her proposal to create a Financial Product Safety Commission to protect consumers against risky financial products, can be found at this entry on the Harvard Law School website. For more on the relationship between illness/injury and bankruptcy, see this empirical study in the journal Health Affairs by Warren, David Himmelstein, Steffie Woolhandler, and Deborah Thorne.
Posted by Brian Wolfman on Monday, July 23, 2007 at 10:09 AM in Debt Collection, Other Debt and Credit Issues | Permalink | Comments (1) | TrackBack (0)
Friday, June 15, 2007
Home Foreclosure Rate Hits 50-Year High
The Washington Post reports here this morning that, according to none other than the Mortgage Bankers Association, the percentage of home mortgage foreclosures in the first three months of this year hit a 50-year high. As the Post article explains, this tragic problem is most acute in the sub-prime market:
The most dramatic fallout took place in the subprime market, which caters to people with blemished credit or other factors that make them a risk to lenders. Those borrowers entered foreclosure at a rate of 2.43 percent, up from 2 percent the previous quarter.
The Post story goes into considerable detail on the issue, discussing, among other things, the connection between the popularity of adjustable rate mortgages and the increasing foreclosure rate. The Wall Street Journal reports the same story, and notes that the Mortgage Bankers Association's chief economist predicts that the foreclosure rate will continue to rise into next year.
Posted by Brian Wolfman on Friday, June 15, 2007 at 07:45 AM in Debt Collection, Other Debt and Credit Issues, Predatory Lending | Permalink | Comments (2) | TrackBack (0)
Wednesday, June 13, 2007
NCLC/NACA Debt Collection Comments to FTC
The National Consumer Law Center and the National Association of Consumer Advocates submitted extensive comments last week on debt collection practices to the Federal Trade Commission, including an appendix describing 34 examples in 17 states of abusive practices. The FTC solicited comments in anticipation of a workshop it is having in the fall on the 30th anniversary of the Fair Debt Collection Practices Act. The FTC is still soliciting original research papers, which are due September 7.
NCLC and NACA described widespread problems including abusive lending practices; growth of the debt buyer industry and sale of debt from one collector to the next; abuse of the courts; mandatory arbitration; abuse of electronic collection methods; and persistence of unlawful harassment, phone calls and threats prohibited by the original 1977 Act.
The Comments proposed a prohibition on debt collection activity unless the collector possesses basic information to verify the debt and to resolve disputes; stronger protection from unfettered electronic access to consumer accounts; disclosure that a debt is time-barred; reforms against creditors including payday lenders, mortgage servicers, and banks that freeze exempt funds; and amendments to strengthen the protections and remedies of the FDCPA.
The comments are available here. The FTC site to comment is here.
Posted by Jon Sheldon on Wednesday, June 13, 2007 at 03:02 PM in Debt Collection | Permalink | Comments (0) | TrackBack (0)
Wednesday, June 06, 2007
Debt Collectors and Answering Machines
by Jeff Sovern
My co-blogger, Deepak Gupta has previously blogged about the FTC's request for comments on debt collection in preparation for a workshop it plans to hold in October. Today is the deadline for submitting comments, though the Commission is willing to receive original research, surveys, and academic papers until September 7. I submitted a comment earlier today (the number assigned my submission suggests only fifteen had been received to that point, though perhaps many last-minute statements have since been or will be filed). The FTC will make the comments available on its website and in fact seven statements received in April and May have already been posted there. The following excerpt from my comment deals with debt collectors who, when attempting to telephone a consumer, instead reach an answering machine:
The FDCPA was enacted in 1977, when telephone answering machines were not yet common, and so the drafters of the statute understandably did not anticipate all the consequences of that technology. In the intervening decades, answering machines and voice mail have, of course, become omnipresent. Answering machines present a dilemma for debt collectors. Debt collectors who repeatedly reach an answering machine and respond by hanging up without leaving a message risk violating § 806, 15 U.S.C. § 1692d, barring harassment, and particularly subsection (5) of that provision (“Causing a telephone to ring . . . repeatedly or continuously with intent to annoy, abuse, or harass any person at the called number.”) and subsection (6) (prohibiting “the placement of telephone calls without meaningful disclosure of the caller’s identity”).
Continue reading "Debt Collectors and Answering Machines" »
Posted by Jeff Sovern on Wednesday, June 06, 2007 at 06:28 PM in Debt Collection | Permalink | Comments (13) | TrackBack (1)
Tuesday, June 05, 2007
Sixth Circuit Reverses Dismissal of Claim Alleging That Discover Card's Harassing Collection Activity Led to Cardholder's Suicide
by Brian Wolfman
Anyone interested in the potential human costs of debt collection harassment should read the Sixth Circuit's recent decision in MacDermid v. Discover Financial Services, No. 06-5792 (May 29, 2007). The complaint in the case alleged that the plaintiff's wife, who suffered from bipolar disorder, committed suicide because of Discover's harassment of the couple over $15,000 in credit card debt. The district court dismissed most of the claims on the pleadings and two claims at the summary judgment stage. The Sixth Circuit reversed the dismissal of the claim that Discover had intentionally inflicted emotional distress or engaged in "outrageous conduct" in violation of Tennessee common law. The court of appeals ruled that the plaintiff at least stated a claim for outrageous conduct based on Discover's threats of criminal prosecution for the failure of the plaintiff and his wife to pay a purely civil debt. The court affirmed the dismissal of various claims under Tennessee law (including a wrongful death claim) and the federal Truth in Lending Act and Fair Debt Collection Practices Act. The facts alleged - - including the wife's heart-wrenching suicide note - - are stated in detail at the beginning of the opinion.
Posted by Brian Wolfman on Tuesday, June 05, 2007 at 09:12 AM in Debt Collection, Other Debt and Credit Issues | Permalink | Comments (2) | TrackBack (1)
SHAME ON U BULLIES.
Sixth Circuit Reverses Dismissal of Claim Alleging That Discover Card's Harassing Collection Activity Led to Cardholder's Suicide
by Brian Wolfman
Anyone interested in the potential human costs of debt collection harassment should read the Sixth Circuit's recent decision in MacDermid v. Discover Financial Services, No. 06-5792 (May 29, 2007). The complaint in the case alleged that the plaintiff's wife, who suffered from bipolar disorder, committed suicide because of Discover's harassment of the couple over $15,000 in credit card debt. The district court dismissed most of the claims on the pleadings and two claims at the summary judgment stage. The Sixth Circuit reversed the dismissal of the claim that Discover had intentionally inflicted emotional distress or engaged in "outrageous conduct" in violation of Tennessee common law. The court of appeals ruled that the plaintiff at least stated a claim for outrageous conduct based on Discover's threats of criminal prosecution for the failure of the plaintiff and his wife to pay a purely civil debt. The court affirmed the dismissal of various claims under Tennessee law (including a wrongful death claim) and the federal Truth in Lending Act and Fair Debt Collection Practices Act. The facts alleged - - including the wife's heart-wrenching suicide note - - are stated in detail at the beginning of the opinion.
Posted by Brian Wolfman on Tuesday, June 05, 2007 at 09:12 AM in Debt Collection, Other Debt and Credit Issues | Permalink | Comments (2) | TrackBack (1)
California and federal law protect you against many unfair, deceptive and abusive debt collection practices. Creditors, professional debt collectors, and attorneys who violate the law are subject to paying actual damages, statutory penalties of $1000, and the consumer's attorneys fees and costs. The following is a list of common violations under the law applicable to California.
Abuse and harassment
Contacts with work, family and friends
Bad check collections
Credit reporting
Bankruptcy discharge violations
Suing in distant locations
Repossessions
Old debt
Debt collector's first communication --requirements
Attorneys fees and other charges added to the debt
Abuse and harassment
Some debt collectors unfortunately try to scare consumers into paying, by making unlawful threats, such as:
• Threats you will go to jail or be arrested if you don't pay (unpaid debt is almost never a crime);
• Threats to harm you or your family, or to come to your house;
• Threats to garnish wages or seize assets before a judgment is taken or before service of a lawsuit is properly accomplished;
• Threats to contact work, family, or friends if you don't pay.
Contacts with work, family and friends
Debt collectors are prohibited from most contacts with people other than you. When contacting others, the debt collector may not state that you owe a debt, or say anything disparaging about you.
Home and friends: Except for your spouse, debt collectors generally may contact family or friends only to obtain your current "location information," which is defined as your home address, work address, and home phone number.
Work: Under California law, a debt collector or creditor may make only one phone call to your work, and only for the purpose of verifying employment. Any other communications must be made in writing, and are limited to requesting location information. Only if your employer fails to respond to a letter could the debt collector call again.
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Bad check collections
California allows bad check collectors to add a $25 charge to the debt. However, some collectors try for more, sometimes several hundred dollars, which they label creatively as settlement fees, civil shoplifting penalties, attorney fees, or other charges.
Most bad check collectors try to collect "treble damages" by mentioning California Civil Code § 1719. However, such debt collectors are not entitled to treble damages until they first notify you, by certified mail, of an opportunity to pay the original bad check amount plus the $25 fee. Bad check collection correspondence should be reviewed by a consumer attorney because the requirements are somewhat complex, and often violated.
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Credit reporting
Debt collectors routinely report credit information to the major credit bureaus, but often fail to report that a debt is disputed, as required by law. For a full explanation of other credit reporting problems, please see the credit reporting section.
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Bankruptcy discharge violations
After a debt is discharged in bankruptcy, it no longer exists. Some debt collectors or creditors nevertheless continue collection efforts, or try to convince you to reaffirm the debt, or even repossess an automobile or other security.
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Collecting on old debt
Merely requesting payment on a debt as to which the statute of limitations has passed is unseemly, but probably not illegal. However, threatening a lawsuit or invoking judicial remedies concerning an expired debt is a violation of the law. Most debt falls under a four year statute of limitations. Remember that you may be re-starting the statute of limitations all over again if you make a monthly payment.
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Suing in distant locations
A professional debt collector may not sue you in a county other than where the contract was signed or where you currently live. Your original creditor, as opposed to a professional debt collector, has the third choice of suing you in the county where you resided when the debt was incurred.
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Repossessions
A creditor does not have to give notice prior to a repossession in California. However, they must give a special written notice after a repossession, and grant you an opportunity to reinstate the contract. There must be a valid default under the contract before they repossess a vehicle. The repo company itself may not breach the peace. See the section on repossessions for more details, including what to do when sued, and required notices.
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Debt Collector's First Communication
A professional debt collector or attorney (but not a creditor) must provide, in the first communication with you (or within five days thereof), the following "validation notice": (1) a statement that unless you dispute the validity of the debt, it will be assumed to be valid; and (2) a statement that if you notify the debt collector in writing within 30 days, the debt collector will obtain verification of the debt; and (3) a statement that if you so request in writing, the debt collector will provide you with the name and address of the original creditor, if different from the current creditor.
California law requires a second notice, effective July 1, 2004. This notice must inform you that debt collectors cannot call at unreasonable hours, may not harass you by using threats of violence or arrest, may not call you at work if it is prohibited, may not call family or friends, and other disclosures. It is likely that many debt collectors are not in compliance with this new law.
Some collectors fail to send the notices. Others fail to stop all contacts after you request verification the debt. Initial letters should be reviewed by a consumer attorney for compliance, even if you don't dispute the debt.
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Attorneys fees and other charges
A debt collector cannot add to the debt any charge to which it is not legally entitled. These illegal charges are often called something plausible, like collection costs, service charges, civil penalties, damages, court fees, attorneys fees, or settlement fees. As just one example, if your written contract with the original creditor did not provide for attorneys fees, the debt collector is not entitled to them. See also our section on bad check collection charges.
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This blog is used to post legal tips for businesses and consumers in California as well as commentaries on issues of interest to clients in the San Diego area. We will also answer general questions on California law submitted via email. For information about our services, please contact us at (619) 448-2129 or visit our website at www.chs-law.com. This publication is NOT INTENDED TO SERVE AS A SUBSTITUTE FOR LEGAL ADVICE. Please consult with a licensed attorney if you require legal advice.
Sunday, April 10, 2005
Ending Creditor Harassment
Under the Federal Fair Debt Collection Practices Act, creditors cannot "harass, oppress, or abuse any person in connection with the collection of a debt". Common examples of illegal harassment are:
The use or threat of use of violence or other criminal means to harm the physical person, reputation, or property of any person
The use of obscene or profane language or language, the natural consequence of which is to abuse the hearer or reader
The publication of a list of consumers who allegedly refuse to pay debts, except to a credit
The advertisement for sale of any debt to coerce payment of the debt
Causing a telephone to ring or engaging any person in telephone conversation repeatedly or continuously with intent to annoy, abuse, or harass any person at the called number
The placement of telephone calls without meaningful disclosure of the caller's identity.
Debtors have two basic options when dealing with creditor harassment. First, the debtor can attempt to end creditor harassment by attempting to reason with the by yourself. You can talk with creditors when they call and honestly explain why you are in default. You can try to reason with creditors and ask for payment extensions or alternative payment arrangements. Unfortunately, debt collectors can be unreasonable and this method will often prove insufficient.
If the creditor will not listen reason, you can send the creditor a "cease & desist" letter instructing them not to contact you. Once the creditor receives this letter, the creditor cannot contact you except under very limited circumstances. Violation of the Fair Debt Collection Practices can result in substantial penalties against the creditor.
Another option is for bankruptcy. Under bankruptcy law, creditors and debt collectors must stop virtually all debt collection activities, including contacting you about a delinquent account. As soon as you file for bankruptcy, all creditors and bill collectors must immediately stop their collection efforts. Once you file the bankruptcy petition, both the Bankruptcy Court and your attorney will notify all of your creditors of your bankruptcy through the mail. While it might take a week or so for your creditors to receive this notice, creditors must also stop calling if you inform them that you filed a bankruptcy petition. In order to ensure creditors stop harassing you, the law provides penalties and fines for debt collectors that continue to contact you after you have filed for bankruptcy.
Click here to find our more about our bankruptcy services.
IMPORTANT DISCLAIMER
This publication is NOT INTENDED TO SERVE AS A SUBSTITUTE FOR LEGAL ADVICE. Please consult with a licensed attorney if you require legal advice.
"News Release
August 24, 2009
For Immediate Release
Contact: (916) 324-5500
Brown Forces Predatory Lender to End Illegal and Abusive Debt Collection Practices
Los Angeles - Attorney General Edmund G. Brown Jr. today forced CashCall, Inc., an Anaheim-based fast-money lender, to stop using "loan shark tactics" in collecting debt, including abusive calls at all hours of the day and night and empty threats of law enforcement action.
The court-ordered judgment also forces CashCall to stop misleading consumers with deceptive advertising and pay $1 million in civil penalties and legal expenses. CashCall used former child actor Gary Coleman as its television spokesman.
"CashCall preyed on consumers desperate for cash, charging triple digit interest rates and using loan shark tactics to collect on their debts," Brown said. "This judgment forces CashCall to stop harassing its customers and should serve as a warning to consumers to be wary of fast-money lenders."
CashCall, owned by Paul Reddam, founder and former owner of DiTech mortgage company, currently charges 139.34% annual interest on the $2,600 loan it offers to consumers. This means that consumers who make the required $298.94 monthly payment over 36 months pay $10,761.84 over the life of the loan. That adds more than $8,000 in interest to the loan.
Brown contends that CashCall used illegal and abusive debt collection practices when customers were unable to make on-time payments, in violation of California Business and Professions Code Section 17200. These practices included:
- Making excessive and verbally abusive telephone calls at all hours of the day and night;
- Causing borrowers to incur bank fees by repeatedly trying to collect payments despite knowing there were insufficient funds in the borrowers' accounts;
- Threatening to initiate law enforcement and wage garnishment proceedings against borrowers without any basis for doing so;
- Improperly discussing private financial information with borrowers' friends, colleagues and neighbors;
- Failing to honor borrowers' requests to cancel automatic withdrawals from checking accounts; and
- Continuing to contact borrowers by phone after receiving requests to only contact them in writing.
Brown also contends that CashCall misled customers with deceptive television, radio and online advertising in violation of Business and Professions Code Section 17500.
CashCall's advertisements falsely suggested that low interest rate loans were available to all borrowers, when in reality, the rates advertised were only offered to some borrowers, usually members of the military. CashCall offered lower interest rates because Federal law limits the interest it can charge on loans to active duty servicemembers and their families.
Today's court order puts an end to CashCall's illegal debt collection practices and stops its misleading advertising. The settlement also requires CashCall to:
- Stop making excessive and verbally abusive telephone calls at all hours of the day and night;
- Pay $1 million in civil penalties and expenses related to the investigation and resolution of this case;
- Train its employees within 30 days and not fewer than four times per year thereafter to ensure compliance with the judgment;
- Terminate any officer, director or employee who violates the terms of the judgment;
- Record all telephone calls made to, or received from, prospective and current borrowers; and
- Maintain a detailed log of all consumer complaints.
A copy of the complaint and final judgment, filed in Los Angeles County Superior Court, is attached.
..."
if I don't pay back a $300.00 cash advance I alledgedly received in March 2011. First number I wasto call 750-588-2200, fax # 760-588-2200 which is not no good. New fax number is 760-692-1490. They claim to be Attorey Based Collectios - cash advance. I am also getting threatening calls from a number in New York about a lawsuit being filed against me for not paying a loan; they get down right nasty. My husband has 32 years law enforcement and told the individual unless he could send paperwork (told before) that a judgement signed by a judge in a precinct, DON'T CALL AGAIN.
They tell me they tried to collect through my bank account but funds were not there; bank says its not true. BEWARE!