Reliance debt collector

His pro bono client’s life had been seized up in such fear that she pawned her wedding ring to feed the maw of a default judgment against her in Los Angeles County Superior Court, obtained by one of the nation’s biggest debt buyers.It was too late to undo the judgment, but Benshoof sued the debt buyer, alleging that its repeated phone calls to the woman were harassing and illegal. The company turned over phone recordings in discovery that showed the calls weren’t as heated as the woman thought.“I still think they crossed a line,” says Benshoof, a partner and big-firm commercial litigator in the Los Angeles office of Alston & Bird.The debt buyer settled, discharging the debt of $5,000, which included interest on the original $3,500 loan, and gave back $2,600 the woman had managed to pay on the judgment.But Benshoof remained curious. His client still insisted she’d never taken out a loan, though she once might have co-signed one. The bank that … [Read more...] about Debt-buying industry and lax court review are burying defendants in defaults

On July 28, the Consumer Financial Protection Bureau (CFPB) released a detailed summary of regulations it is considering imposing on third-party debt collectors.The CFPB’s proposals serve four purposes:Providing clarifications to the Fair Debt Collection Practices Act (FDCPA)Imposing heightened substantive restrictions on debt collectorsStrengthening initial written disclosures that debt collectors must provide when communicating with a consumerDirectly targeting the data integrity and continuity issues associated with the purchase and sale of delinquent debtThese proposals, once finalized, stand to potentially form the basis of significant “unfair, deceptive, or abusive acts or practices” (UDAAP) enforcement and regulatory actions against large bank and non-bank financial institutions that use third-party debt collectors to collect debts on their behalf or sell charged-off debt to third-party debt collectors.The CFPB has issued these proposals as an initial … [Read more...] about CFPB Previews Anticipated Debt Collection Regulations

Leading the Past WeekAnd the beat goes on… Another week with the White House dealing with another issue, this time news that the national security apparatus is collecting and combing through telephone record metadata.  The widespread revelation about a data mining program that would make any hedge fund quant jealous drowned out more positive news of the week, including that the U.S. recovery continues its sluggish, yet positive pace with 175,000 jobs added in May.And in an interesting comparison, as noted by the extraordinary team at Davis Polk, while the agencies were silent during the Month of May, and did not announce any new implementations of the Dodd-Frank Act, last week, three major implications of the implementation were announced.  First, the SEC publicly released its much anticipated and long awaited money market mutual fund rules.  Second, the Fed announced an almost equally anticipate interim final “push out” rule that provided … [Read more...] about Financial Services Legislative and Regulatory Update – Week of June 10, 2013

Title X of the Dodd-Frank Act created the Consumer Financial Protection Bureau (“Bureau” or “CFPB”). This Bureau is focused solely on consumer financial protection. The Bureau has six primary functions,1 including the authority and responsibility to supervise covered persons for compliance with Federal consumer financial law2 and take appropriate enforcement action to address violations of same. The Bureau does not supervise covered persons for safety and soundness the way bank regulators do; rather, its sole stated interest is the protection of financial consumers in particular.One year old on July 21, 2012, this Bureau has spent its first year aggressively pursuing its mandate: to implement and enforce Federal consumer financial law. It has been actively issuing proposed and final regulations and guidance, as well as filing amicus briefs in various court proceedings. The Bureau has also been   conducting and participating in exams of covered parties. … [Read more...] about The Consumer Financial Protection Bureau – The New Sheriff in Town

Henson v. Santander Consumer USA, Justice Neil Gorsuch channeled Justice Scalia and said that the court had to follow the “statute’s plain terms” and concluded the “proper role of the judiciary in that process is to apply, not amend, the work of the People’s representatives.”The problem with this approach is that the cases that come to the Supreme Court involving statutory construction rarely involve laws where the language has a clear, plain meaning. Instead, the court engages in a fiction: It quotes the ambiguous language, declares that there is a “plain meaning,” and then comes to its desired conclusion.Two cases from last term involving the Fair Debt Collection Practices Act (FDCPA) illustrate this. In Henson v. Santander Consumer USA, the issue was whether The act applies to creditors who had purchased the debt from another creditor. The FDCPA was adopted to deal with the abusive practices of creditors in collecting debts, such as … [Read more...] about Chemerinsky: The myth of ‘plain meaning’