Consumer Financial Protection Bureau

After decades of abusive business practices, collection agencies are finally going to be properly legislated and scrutinized. The Consumer Financial Protection Bureau announced in October of 2012 that it would also begin overseeing the largest nonbank debt collection firms—those with more than $10 million in annual receipts— starting in January 2013.Current estimates put non-current debts at $278 billion, comprised of 23 million automobile, credit card accounts, and personal and business loans. Outstanding student loan debt is at around one trillion dollars; the CFPB has handled thousands of complaints from private student loan borrowers during 2012 (over 2,900 during the first seven months alone).At the center of many individual debts is shoddy, inadequate paperwork; the largest financial institutions in America sold delinquent credit card accounts to collection agencies and law firms without providing adequate or even accurate documentation to corroborate the amounts they claimed were past due. In 2011, the Office of the Comptroller of the Currency launched a regulatory probe, which led several debt collection agencies to stop their credit card collection operations.Debt collection agencies frequently file suits against debtors, and many debtors don’t have the means to legally defend themselves in court, or can’t appear; when this happens, judges award default favor of financial institutions (around 95% of the cases). When debtors do come to court with legal representation, they win a huge majority of the cases; inconsistencies in lender documentation and record keeping sway the judgments. Frequently financial institutions sell debt to third parties without appropriate paper trails, and if the collection agency has no access to the original creditor’s business records, and/or no proof as to how the debt began, they cannot attest to the validity of the debt and will lose in court.If a collection agency has harassed you, you may be entitled to money damages up to $1,000.00, based on the FDCPA, which has been around for almost 35 years. The FDCPA is a federal law that applies to every state. In other words, everyone is protected by the FDCPA. The FDCPA is essentially a laundry list of what debt collectors can and cannot do while collecting a debt, as well as things debt collectors must do while collecting a debt. Plus, the FDCPA has a fee-shift provision. This means, the collection agency pays your attorney’s fees and costs. Founding attorney, Michael Agruss, has settled over 1,500 debt collection harassment cases. We want to help you, too.