When a New Jersey law firm purchased charged-off debt, then filed suit to collect it, it found itself facing a Fair Debt Collection Practices Act (“FDCPA”) putative class action. The lawsuit alleged that Hudson Law Offices, P.C. violated the New Jersey Professional Services Corporation Act (“PSCA”) by engaging in the business of purchasing defaulted credit-card debt and then suing alleged consumers to collect those debts. In denying the law firm’s motion to dismiss the Complaint, a New Jersey Federal Court Judge found that the a law firm organized under the New Jersey PSCA is prohibited from engaging in any business…
Posts published in “FDCPA”
Fair Debt Collection Practices Act
In a blow to debt collection attorneys, the Third Circuit ruled that a letter sent by a foreclosure attorney to the mortgagee’s attorney could form the basis of a violation under 15 U.S.C. 1692f(1) of the Fair Debt Collection Practices Act. In addition, the debt collection attorney is not shielded by New Jersey’s common-law litigation privilege. The decision, Allen v. LaSalle, is available here: Allen v LaSalle Bank. In response to a request from the debtor’s attorney, the debt collection attorney sent a payoff letter which allegedly sought to collect fees and charges not permitted by New Jersey law. The…
An Illinois attorney faces disciplinary discipline charges allegeing the attorney violated the Rules of Professional Conduct when he paid referral fees to a non-lawyer. The attorney was a principal in the “Consumer Credit Defense Network” (CCDN) self-styled as “a network of attorneys across the nation the nation . . . that specialize in the unsecured debt relief, negotiation and litigation arena (sic).” In addition to the referral fees, the Board alleges that the attorney deceived his clients in the nature of services provided. A client would receive a “Debt Reconciliation Program Enrollment Manual” after paying a fee between $2,500 and $4,800. The Manual outlined…