CFPB Orders Portfolio Recovery Associates To Pay $24 Million For Illegal Debt Recovery Practices
The Consumer Financial Protection Bureau (CFPB) filed suit against Portfolio Recovery Associates, one of the largest debt collectors in the nation, for repeated violations, and for violating a 2015 CFPB order, and for engaging in other violations of the FDCPA (Fair Debt Collection Practices Act). The proposed order would levy a $24 million fine against the company. $12 million of that money would go to paying consumers who were harmed by the company’s illegal debt collection practices. The other $12 million would be deposited into the CFPB’s victims relief fund.
Portfolio Recovery Associates was in trouble with the CFPB before. In 2015, the company was required to sign an order ensuring it would abide by the law. The CFPB accuses Portfolio Recovery Associates of violating that order. According to the CFPB, Portfolio Recovery Associates:
- Collected on unsubstantiated debt
- Collected on debt without providing required documentation and disclosures to consumers
- Sued or threatened to sue consumers without offering or possessing required documentation
- Sued to collect debt outside the statute of limitations
- Failed to properly investigate and resolve consumer disputes about the company’s credit reporting
Making representations about unsubstantiated debts
Portfolio Recovery Associates is alleged to have made at least tens of thousands of representations about unsubstantiated or disputed debts and failed to review the required documentation to support claims.
Threatening consumers with potential legal actions and initiating debt collection lawsuits without offering or possessing the required documentation
Portfolio Recovery Associates’ lawyers sent millions of form letters to consumers notifying them of potential legal action without first offering to provide all required documents. The company also initiated thousands of lawsuits against consumers when it lacked the proper documentation concerning the debt.
Misrepresenting it would provide certain documents within 30 days
The form letters sent by Portfolio Recovery lawyers stated that, upon receipt of a written request from the consumer, Portfolio Recovery Associates would provide proof of documentation mentioned in the letter. On numerous occasions, Portfolio Recovery Associates failed to provide these documents in time after receiving a company’s written request for them. This impeded consumers’ ability to determine whether the debt was owed and how they should respond to the allegations of outstanding debts.
Collecting on time-barred debt without making required disclosures
Portfolio Recovery Associates is alleged to have attempted to collect on expired debt by not providing the required disclosures to consumers when collecting on debts beyond the statute of limitations.
Suing to collect on time-barred debt
Portfolio Recovery Associates is alleged to have initiated dozens of lawsuits related to debt that was too old to legally enforce. In doing so, the company falsely represented that consumers had legally enforceable obligations to pay the debt. In other words, they lied. The debt was outside the statute of limitations.
Talk to an Ohio Creditor Harassment Attorney Today
Kohl & Cook Law Firm, LLC represents the interests of debtors in FDCPA claims of illegal debt collection practices, creditor harassment, and debt disputes. Call our Columbus consumer lawyers today to schedule an appointment, and we can begin discussing your next steps right away.
Source:
consumerfinance.gov/about-us/newsroom/cfpb-orders-portfolio-recovery-associates-to-pay-more-than-24-million-illegal-debt-collection-practices-reporting-violations/
