Earlier this month, Reuters reported that several state attorneys general are engaged in a coordinated investigation of the defaulted debt sales practices by some of the nation’s largest banks. Last fall, the American Banker reported that Mississippi Attorney General Jim Hood was looking at JPMorgan Chase’s debt sales practices. The Federal Trade Commission released its study last month entitled The Structure and Practices of the Debt Buying Industry. And then there are remarks recently delivered by Richard Cordray, Director of the Consumer Financial Protection Bureau (“Bureau”), at the first meeting of its Consumer Advisory Board: [A] creditor may decide to sell [a defaulted debt] to or contract with…
Today’s Decision of the Day is Vartanian v. Portfolio Recovery Associates, a Fair Credit Reporting Act (“FCRA”) opinion from the United States District Court for the Central District of California. The opinion examines the FCRA’s conflicting preemption provisions, § 1681t(b)(1)(F) and § 1681h(e), in the context of a claim arising from a person’s furnishing of information to a credit reporting agency. Section 1681t(b)(1)(F) can be read to preempt all state law claims, but at the same time others read § 1681h(e) as permitting state law claims based on willful or malicious conduct. Congress amended the FCRA in 1996 by adding § 1681t(b)(1)(F) to preempt “any state laws that imposed any ‘requirement or prohibition’…
A Texas legislator has introduced a bill proposing service of process through social media in certain instances.The Texas proposal makes very good sense because it provides more effective substituted service then courts regularly approve today.
In this March 6 decision from the U.S. District Court from the Northern District of Illinois, the court enters judgment dismissing a putative class action, holding that an assignment of only the rights to collect and sue on a debt is sufficient for purposes of §8(b) of the Illinois Collection Agency Act. Hat tip to Katrina Christakis of Pilgrim Christakis LLP in Chicago.
Those of us who engage in consumer financial services defense work are often not surprised to see some awfully strange situations on the plaintiff side of the aisle. But it recently got very strange in a case out of the United States District Court for the Northern District of Texas, as you can read below. Hat tip to Manny Newburger of Barron & Newburger, P.C. in Austin, Texas.
To suggest, as some mistakenly have, that an audio recording of the consumer’s verbal consent is arguably not a sufficient electronic signature, is simply contrary to the express definition of an an electronic signature under E-Sign and the Congressional Record made at its enactment.
In a seven to two opinion released this morning, the Supreme Court held that a plaintiff, who is unsuccessful in a claim under the Fair Debt Collection Practices Act (“FDCPA”) 15 U.S.C. 1692, et seq., can be liable for the defendant’s costs even if the lawsuit was not brought in bad faith. The opinion was delivered by Justice Thomas. Justices Sotomayor and Kagan dissented with Justice Sotomayor on the dissenting opinion. Marx concerned whether the FDCPA’s section 1692k(a)(3), which provides for an award of attorneys fees and costs if an FDCPA suit is brought in “bad faith and the the purpose of harassment,” prevents the awarding…
Last August the American Bar Association adopted several amendments to its Model Rules of Professional Conduct. Several of these changes would impact attorneys engaged in credit and collection law, if adopted in their jurisdictions. I’ve prepared the attached whitepaper outlining the amendments. More information on the ABA’s 20/20 Commission and other amendments to the Model Rules of Professional Conduct adopted this month are available here.
Here are the slides from my presentation The Consumer Financial Protection Bureau’s Impact on the Practice of Law made to the New Jersey Creditor’s Bar Association (NJCBA) on February 19, 2013. The NJCBA is a terrific organization supporting attorneys engaged in the practice of collection and credit law in New Jersey. Anyone interested in membership should drop me a line at dsm@mnlawpc.com.
What would it be like to undergo a CFPB examination? What will be the CFPB’s focus in examining debt purchasers and what methods will the CFPB use to gather information about their operations? Find out at the DBA International Conference next week where I’ll be presenting Ready or Not, Here Comes the CFPB with some of the best and brightest on this topic — my colleagues Alan Kaplinsky and Chris Willis from Ballard Sphar, who bring you CFPBMonitor.com, and Tomio Narita from Simmonds & Narita LLP, author of the FDCPA Defense Blog. More information about DBA International and its Annual Conference in…
The Fourth Circuit Court of Appeals held that a debt collector did not violate the federal Fair Debt Collection Practices Act (“FDCPA”) when it made multiple calls to a third party in an effort to locate a debtor. In Worsham v. Accounts Receivable Management, filed yesterday, a debt collector, who was unable to locate a debtor, instead placed 10 telephone calls to the debtor’s brother-in-law, Worsham, in May 2010. Worsham answered two of the calls and heard an automated message prompting him to press “1” if he was the debtor or “2” if he was not. On one occasion Worsham pressed “2” and then hung…
Thanks to all who attended my November 9 presentation in New York on Ethics and Consumer Financial Services Law. You can obtain a copy of the powerpoint here: Ethics6. The handout can be accessed here: Avoiding ethical pitfalls 20121105.