Debt Collectors Are Prohibited From Contacting Debtors Who Are Represented By An Attorney

FDCPA Prohibits Contacting Represented Debtors

The federal Fair Debt Collection Practices Act or FDCPA prohibits a debt collector, which includes collection agencies, debt buyers, and collection lawyers, from contacting a debtor who they know or should know is represented by a lawyer. This knowledge may come from the debtor telling the collector he has a lawyer, or may come from prior efforts to collect the debt. In any event, a debt collector who contacts a represented debtor is subject to claims under the FDCPA, including statutory damages of up to $1,000, and any actual damages. 

 

Portfolio Recovery Associates Sued For Collecting on a Settled Debt

Portfolio Recovery Associates, LLC, or PRA is a huge debt buyer that files thousands of law suits every year to collect debts it has purchased for pennies on the dollar. PRA files hundreds of collection suits here in Arizona.

My office recently filed a case under the Fair Debt Collection Practices Act or FDCPA against PRA for attempting to collect an alleged balance on a judgment which had been settled in full, and which had been set aside by the justice court so there was no longer a judgment.

Collection Abuse Continues Against Arizona Consumers

As this case illustrates, collection abuse by collection agencies, zombie debt buyers, and their collection lawyers continues in spite of federal law prohibiting their actions. The FDCPA prohibits a debt collector --- including collection agencies, zombie debt buyers, and collection attorneys --- from misrepresenting that a debt is owed when it is not. The FDCPA also prohibits a debt collector from attempting to collect amounts not owe, including aksing for payment of a debt which has already been settled. 

 

What You Need to Know About Wrongful Repossessions

No Notice Required

In a typical scenario, a finance company or bank can order the repossession of your car or truck if you fall behind on your monthly payments. The bank is not required to give you any prior notice before repossessing the vehicle. Under Arizona law, the company employed to pick up your car --- the repossession or repo company --- can take your car out of the driveway, from a parking lot at work or at the store, or from any other place you may park the car which does not have any access restrictions. They cannot go through a garage, a locked gate or fence, or anything else which blocks access to the car.

Breach of Peace

In taking possession of a vehicle, the repo company cannot take any action which would be considered a "breach of the peace." Breach of the peace includes use of bodily force, threats, trespass, deception or trickery. A repo company also cannot enter your residence without your consent, and cannot seize property over your objections. 

I have seen cases where the repossession company will stake out a home waiting for the debtor to leave with the vehicle and then follow after it. This is legal so long as It does not follow too closely, drive recklessly or otherwise try to intimidate the debtor.  Forcing the debtor off the road, or pinning them into a place where they cannot leave is also a breach of the peace.

Remedies

Victims of a wrongful repossession or breach of the peace by a repossession company in Arizona can pursue damages against the repossession company and the bank for damages. The bank is liable to the damages caused by the repossession company. 

Maricopa County Superior Court Confirms Four Year Statute of Limitations in Auto Sales Contract

Maricopa County Superior Court reaffirms Four Year Statute of Limitations in Deficiency Claim

In the Case of Autovest, LLC v. Randall, CV2014-013134, Maricopa County Judge Karen A. Mullins reaffirmed that the statute of limitations to collect on a deficiency balance for an auto loan after repossession is only four years. If the car was purchased using a Retail Installment Sales Contract, and the dealer arranged the financing, then the statute of limitations runs four years after the car is repossessed.

Complete Defense to Colleciton Action

In Arizona, if you are sued by a lender for a deficiency balance after repossession, and the lender has waited four years or more to file suit, they you should have a complete defense to the collection action. Meaning, you should be able to get the case dismissed and not owe anything.

National Collegiate Student Loan Trust Loses Arbitration on Statute of Limitations

In a case where National Collegiate Student Loan Trust sued my client in Maricopa County Superior Court to collect on a private student loan, the arbitrator found in favor of the Arizona consumer and dismissed the claim.

Arizona Six-Year Statute of Limitations Applies to Private Student Loans. 

The statute of limitations on a private student loan is the same as any other credit or contract obligation. Thus, if it is a written contract,  signed in Arizona, the statute of limitations is usually six (6) years.

Arizona Four-Year Statute of Limitations Applies to Private Student Loans Incurred Outside of Arizona.

The exception to the six-year statute of limitations is a loan which was entered into in another state other than Arizona. For example, if you signed for the student loan while living in Oregon, then the Arizona four-year statute of limitations should apply.

National Collegiate Student Loan Trust sues Arizona consumers under under several different names, such as NCSLT 2006-1, 2006-3, 2007-2 or NCSLT 2007-4, etc.  

Collection Agency Violates Telephone Consumer Protection Act

National Credit Adjusters, LLC Sued in Arizona for Violating Telephone Consumer Protection Act

My office recently filed suit against the Kansas collection agency National Credit Adjusters, LLC for violating the Telephone Consumer Protection Act, or TCPA. The suit alleges that National Credit Adjusters repeatedly telephoned the consumer's cellular phone in an attempt to collect a debt allegedly owed by the prior owner of the phone number. An agency, like National Credit Adjusters, often will use an auto dialer to telephone a debt who has now changed phone numbers. The calls then go to the new owner of the number who does not owe the debt. In addition, the new owner of the number never gave National Credit Adjusters permission to call. So the calls all violate the TCPA

TCPA Provides Recovery of Damages fro Arizona Consumers

The TCPA provides the recovery of damages of either $500 for each negligent call or $1,500 for each willful call. So an Arizona Consumer who has been called 20 times on their cell phone for a debt which does not belong to them, may be able to assert a claim for damages between $10,000 and $30,000.

 

FDCPA Requires Notice Prior to Bank Withdrawal

FDCPA Requires Collection Agencies to Give Consumer Notice Prior to Taking Monthly Withdrawals From Bank Account

Many consumers enter into payment agreements with collection agencies where the agency will take month payments from the consumer's bank account to pay off the debt. However, in order to take these automated and post dated payments, the collection agency must first sent written notice not more than 10 nor less than 3 business days before the withdrawal. So if a payment is scheduled to come out on the 15th of the month, the agency should be sending a letter sometime between the 1st and the 10th of the month. Most important, is that the debtor be given sufficient notice to make sure funds will be available in the bank account, and if they are not, sufficient time to notify the agency to not take the withdrawal.

Failure to Give Proper Notice of an Automatic Withdrawal Violates the FDCPA

A collection agency or law firm which fails to provide a debtor with adequate notice of an upcoming withdrawal from a bank account violates the Fair Debt Collection Practices Act, or FDCPA. The FDCPA provides consumers with claims for damages for these types of violations.

Arizona Consumer Sues National Credit Systems, Inc. for Failure to Give Written Notice Prior to Taking Automatic Bank Withdrawals

My office recently filed suit in Federal Court alleging National Credit Systems, Inc. failed to provide notice adequate notice to the debtor prior to taking out pre-authorized monthly debits from her bank account. Such failure to give proper notice violates the FDCPA. 

Client Services, Inc. Sued for Debt Collection Abuse

Arizona Consumer Sues Client Services, Inc. for Debt Collection Abuse

My office recently filed suit against the Missouri collection agency Client Services, Inc. for violations of the Fair Debt Collection Practices Act or FDCPA. The suit alleges that Client Services sent a letter demanding payment of over $147,000 for a Citibank credit card account which had a ending balance of less than $17,000 ten years earlier. When the debtor disputed the debt and demanded verification, Client Services sent copies of several old Citibank billing statements which showed less than $17,000 was owed.

Right To Dispute Debt

Under the FDCPA, a consumer has the right to challenge the debt by sending the collection agency a dispute letter and requesting verification the debt. If this is done within 30 days of the receipt of the initial letter from the collection agency, the agency is required to stop all collection activity until it provides validation and verification of the debt. That is what the debtor did in this case. He demanded that Client Services provide proof that he owed $147,000 as claimed in Client Services' initial letter. However, Client Services only provided statements showing $17,000 was owed, not $147,000. 

FDCPA Prohibits Collection Agencies from Collecting Amounts Not Owed

A collection agency cannot collect or attempt to collect any amount which is not owed under the contract, or which is not provided for by law. Sometimes, agencies add extra fees, or interest which is not allowed by the underlying contract, and or not allowed by law. If an collection agency attempts to collect these "forbidden fees," they are in violation of the FDCPA and the consumer has a right to collect damages for the agency's illegal actions. The suit alleges Client Services, Inc. attempted to collect amounts which were not owed, thus violating the FDCPA.

Defending a Lawsuit filed by Autovest, LLC

 

Have you been sued by Autovest, LLC?

Autovest has filed hundreds of lawsuits against Arizona debtors to collect deficiency balances on vehicles which were repossessed years ago. In many of the cases I have seen, the statute of limitations has passed. Meaning, you would have a complete defense to Autovest’s claim. Under Arizona law, an automobile lender generally has only four years after the repossession to file suit to collect any remaining balance. If it waits four years and 1 day, it is too late and you can get the case dismissed. 
Why then would Autovest sue on accounts which are Past the Statute of Limitations?

One might wonder why Autovest would sue someone on a debt if it knew the statute of limitations had run. Well, under the rules in Arizona courts, if you – the debtor – do not answer the lawsuit and raise the defense of statute of limitation, the defense is waived, meaning Autovest can get a judgment which it can then collect on. 
What should I do?

First off, do no wait to get help. If you wait too long, then Autovest can get its judgment and you will have to pay the old debt. 
Second, make sure you contact an experienced consumer lawyer in your state to assist you. If the statute of limitations has run, some consumer lawyers will agree to defend these Autovest cases with little or no cost to you.
Third, make sure you are not one of Autovest’s victims. Get help now!

 

Asset Acceptance LLC Sued Arizona Consumer for Navy Federal Credit Union Account which is Past the Statute of Limitations

Recent client inquiries reflect that Asset Acceptance LLC, a large national debt buyer who claims to have purchased a large portfolio of debts originating with the Navy Federal Credit Union, is suing Arizona debtors on these debts. In a recent case I investigated, it appears that the Navy debt is well beyond the applicable statute of limitations in Arizona for credit card debt which is now 6 years. Calls from other Arizona consumers confirms this may be happening on a regular basis.

Despite the underlying debt being stale (past the statute of limitations), Asset has filed suit using one of its Arizona law firms Fulton, Friedman & Gullace. It is common knowledge that many debt buyers file suit hoping that Arizona debtors will ignore the law suit and the debt buyer will obtain a default (meaning uncontested) judgment. Once the judgment is entered, the claim becomes valid and the debt buyer can garnish wages or bank accounts to collect the debt.

Not only are these stale debts completely defensible, the federal Fair Debt Collection Practices Act (FDCPA) prohibits such actions. Under the FDCPA, an Arizona consumer wrongfully sued by Asset can seek recovery of damages from the illegal lawsuit.

Protect Your Rights. If you are an Arizona consumer who has been sued by Asset Acceptance LLC on a Navy Federal Credit Union account, please contact Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation.

Commercial Recovery Systems, Inc. Sued for Harassing Arizona Consumer

My office recently filed suit under the federal Fair Debt Collection Practice Act or FDCPA against Commercial Recovery Systems, Inc. (“CRS”) for calling and harassing an Arizona consumer over a debt which was beyond the statute of limitations. The complaint alleges that the debt is stale and beyond the Arizona statute of limitation to collect by legal action, yet CRS telephoned and threatened this Arizona debtor with legal action, including threats of wage garnishment, freezing of her bank account, taking her income tax refund, and placing a lien on her current vehicle if she did not pay.

The FDCPA protects Arizona consumers from these types of threatening calls from collection agencies. In this case CRS’s alleged actions are even more egregious since the collector’s manager got on the phone and confirmed that these actions would in fact be taken unless the account was paid.

If you are an Arizona consumer who is receiving harassing or threatening collection calls from Commercial Recovery Systems, Inc. or other collection agency, please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation to see what your rights are.

CONSUMER Defeats Motion to Dismiss in FDCPA Case

The United States District Court for Arizona recently denied a motion to dismiss filed by Potts & Waldron, PC and Mark W. Waldron concerning claims that their collection letter violated the Fair Debt Collection Practices Act or FDCPA.

Potts & Waldron sent an initial letter to the Arizona consumer threatening legal action if the debt was not paid within 30 days from the date of the letter. The Court concluded that the consumer's claim should not be dismissed as this threat effectively overshadowing the rights provided by the FDCPA which allows a consumer 30 days after her receipt of the letter to send a letter disputing the debt and requesting verification. The court agreed in its Order denying the motion to dismiss that Waldron’s letter likely overshadowed and otherwise did not comport with the FDCPA.

The FDCPA protects Arizona consumers from collection harassment and abuse– even abuse received at the hands of collection lawyers attempting to collect on Home Owner Association (HOA) dues and fines.

If you are an Arizona consumer who is being harassed by a collection agency or collection attorney, please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation.

Northland Group Incorporated Sued for Collecting on Settled Debt

In December 2012, my office filed suit on behalf of an Arizona consumer who had previously settled her debt through Northland Group, and who was then subsequently contacted by Northland to collect on the same settled debt.

The Fair Debt Collection Practice Act or FDCPA protects Arizona consumers from receiving collection activity on an account which is not owed. In this case Northland’s actions are extra egregious since the account was settled through it and it knew that nothing more was owed on the account.

If you are an Arizona consumer who is receiving collection calls or letters on an account that you do not owe, or one that was previously settled, please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation to see if I can help you.


ASSET ACCEPTANCE LLC Loses Lawsuit and Refuses to Pay Arizona Consumer’s Judgment

Asset Acceptance LLC filed suit against an Arizona consumer and lost, but now is refusing to pay the judgment entered by the court for the consumer’s court costs and attorney’s fees.

Asset Acceptance sued in early 2012 claiming it was the assigned owner of the consumer’s Capital One Bank account. At trial, Asset attempted to get documents entered into evidence, but the Globe Justice Court correctly ruled that Asset’s witness did not have the personal knowledge to authenticate the documents or to testify concerning Asset’s claimed ownership of the account. The court entered Judgment in the defendant’s favor and awarded attorney’s fees and court costs.

Collecting from the Collector.

Several demands have been made to Asset Acceptance’s lawyers, Fulton Friedman & Gullace, LLP, but no payment has been forthcoming. A garnishment was served on the attorneys Fulton Friedman & Gullace, LLP to force Asset to pay, but still no response from Asset or its lawyers.
 
If you have been recently sued by Asset Acceptance LLC or Fulton Friedman & Gullace, LLP, I may be able to help you. Please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation.

Greater Glendale Finance, LLC Files Stale Suits Against Arizona Consumers

Greater Glendale Finance, LLC, previously known as Walker Motors Financing, LLC, continues to file lawsuits against Arizona consumers well after the statute of limitations has run. Greater Glendale Financing is the finance arm of the J.D. Byrider dealership located in Glendale, Arizona. Over the years, J.D. Byrider has sold thousands of vehicles to Arizona consumers and financed those purchases through its financing arm which has gone by the names of CNAC, Walker Motors Financing, LLC and now Greater Glendale Finance, LLC.

Like its franchise twin Bartolini Finance in Mesa, Arizona, and Bartolini’s sister company Grace Finance in Chandler, Arizona, Greater Glendale Finance is the financial arm for the JD Byrider franchise in Glendale. When a car is sold by JD Byrider, the sales/finance contract is assigned to Greater Glendale Finance. If payments are missed, and the car gets repossessed, Greater Glendale has four years under Arizona law to bring a lawsuit to collect any deficiency it claims to be owed.

What Greater Glendale is doing, like Bartolini Finance has been known to do, is waiting until nearly six years after the repossession before bringing suit. Greater Glendale then tries to argue that the contract is covered by the six year statute of limitations for a written contract, when the law in Arizona is clear that the statute of limitations on a vehicle finance contract is four years.

If you have been recently sued by Greater Glendale Finance, LLC, I may be able to help you. Please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation.

Post - Bankruptcy Credit Reporting of Consumer Debts.

I have seen a recent increase in the number of Arizona debtors who have discharged debts in bankruptcy which are still reporting on their credit reports as current collection accounts or charge offs, and showing a balance owed. 
Once a debtor has received a discharge in bankruptcy, the creditor or the debt buyer who purchases the debt can no longer report the account to the credit reporting agencies showing a balance owed or that the account is a current collection account. Many times, however, the negative collection or charge off information is still sitting on the credit report from before the bankruptcy. 
The obvious problem with this continued reporting of discharged debts is that anyone looking at your credit report, including banks, mortgage lenders, car dealerships,  and insurance companies, etc. think that you have now defaulted on a debt after you filed bankruptcy. This drops your credit score, commonly referred to as a FICO score, significantly. And no lender is going to give you a loan with a current charged off or collect account on your credit report.
Under the Fair Credit Reporting Act, or FCRA, you have a right to contact the credit bureau and dispute the reporting of the account. (Click here for instructions on how to dispute information to the credit reporting agencies). If it is not corrected, then you may need to take legal action to get the attention of the bank or debt buyer in order to correct the credit report.
If you are an Arizona consumer who has received a bankruptcy discharge but still has derogatory credit information reporting post-bankruptcy, please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free consultation and review of your credit reports.

Statute of Limitations on Repossessions is 4 Years

The Arizona Court of Appeals recently issued an opinion addressing the statute of limitations in a repossession lawsuit to collect a deficiency. The case is titled Baseline Financial Services v. Madison, 278 P.3d 321 (2012) (click here to see a copy of the Opinion).
The opinion clarifies that the statute of limitations in Arizona for the collection of a deficiency on a repossession is four years, not six as many of the collection agencies argue. See A.R.S. § 47-2725(A).
If you are an Arizona consumer who has been sued on a deficiency balance from a repossession, please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation to determine if you have a defense to the lawsuit.

Can a Collection Agency or Attorney Serve Subpoena on Your Employer?

I have recently seen several Arizona cases where the collection agency served a subpoena on the debtor’s employer prior to obtaining a judgment. This is generally illegal. The only third party contact a collection agency can make prior to taking a judgment is for obtaining location information. If they subpoena your employer and ask for anything more, then they will most likely have violated the Fair Debt Collection Practices Act, or FDCPA.
The subpoenas I have seen served on Arizona employers request information concerning the Arizona debtor’s bank account, drivers license, hire date, hourly rate, etc. All of this information is private and not allowed to be requested by subpoena in a collection lawsuit unless there has already been a judgment entered.

If you are an Arizona consumer who has been subjected to this kind of illegal invasion of your privacy, please call Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822 for a free phone consultation.

COLLECTION AGENCIES USE FAKE CALLER ID TO DECEIVE ARIZONA CONSUMERS

Collection agencies are increasingly disguising their real identity by using fake caller ID to get Arizona consumers to pick up the phone. When a debtor fails to answer collection calls, collection agencies are using local numbers or common business names in the caller ID line to get people to answer the calls.

Even though there are regulations and laws against “caller ID spoofing,” collectors use it as a way to get consumers to pick up their phone.

However, a collection agency violates the Fair Debt Collection Practices Act (FDCPA) if it “spoofs” its identity in a call to a consumer to collect a debt.

If you are an Arizona consumer who has been contacted by a third-party debt collector or debt buyer and feel that their collection actions were deceptive, unfair, harassing, or abusive, please call attorney Floyd W. Bybee at (480) 756-8822.

West Asset Management Inc. Agrees to Pay $2.8 Million to Settle FTC Complaint.


The collection agency West Asset Management has agreed to pay a civil penalty to settle the Federal Trade Commission’s complaint against it for violating the Fair Debt Collection Practices Act. West Asset Management was accused of the following illegal behavior:
 
•    Misrepresenting itself as a law firm or that its collectors are attorneys;
•    Misrepresenting that debtors will be arrested or have their property seized if they don’t pay;
•    Threatening actions that would be illegal, or actions that the company has no intention of taking;
•    Making false statements to collect a debt or obtain information about a consumer;
•    Withdrawing funds from consumers’ bank accounts or charging their credit cards without their consent;
•    Depositing postdated checks before the date on the check, or threatening to do so;
•    Revealing to third parties that a consumer owes a debt;
•    Asking a third party for a consumer’s location information more than once without the third party’s consent or a reasonable belief that the person’s earlier response was wrong or incomplete and that the person now has correct location information;
•    Calling consumers before 8 a.m. or after 9 p.m., or at their workplace;
•    Communicating with a consumer after receiving written notice that the consumer refuses to pay or wants the collector to stop calling; and
•    Using obscene or profane language, or harassing consumers with repeated phone calls.

West Asset is not the only agency that uses all or some of these illegal collection tactics against Arizona debtors.

If you are an Arizona consumer who has been contacted by a third-party debt collector or debt buyer and feel that their collection actions were deceptive, unfair, harassing, or abusive, please call attorney Floyd W. Bybee at the BYBEE LAW CENTER, PLC (480) 756-8822.