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July 26, 2009

Another good reason why Congress should create a new agency to replace the FTC

While the below article from focuses on the Fair Debt Collection Practices Act, it is also true about the Fair Credit Reporting Act. I know of no actions against the credit bureaus recently filed by the FTC or other governmental agencies but FCRA lawsuits filed by individuals are happening every day. Too bad some of the best parts of the FCRA can only be enforced by the FTC or other governmental agencies.

Fortunately, Congress is currently considering creating a new agency to give this power to that allegedly be able to focus more on enforcing the FCRA, FDCPA and other consumer statutory schemes. Unfortunately, this will probably result in more of the same. The best (and cheapest) alternative is for Congress to allow private lawsuits for all the consumers' rights under the FCRA, FDCPA, etc. This will allow for the enforcement of these statutes without costing the government the expense of doing the enforcing. And it will allow attorneys to make money, which is then taxed as income to the attorney and thus makes the government money. This is what is typically called a "win win", but probably won't happen since this is the GOVERNMENT we are talking about. If it makes sense, it usually won't happen. But I digress.

Here's the article about the FDCPA:

"Most of 4,054 the federal consumer credit lawsuits filed so far in 2009 are Fair Debt Collection Practices Act (FDCPA) against Debt Collectors and debt collection law firms.

You can see for yourself at

If you ask me that’s a lot of consumers being abused by debt collectors using questionable collection tactics. This is quite troubling as it shows that for the most part the Federal Trade Commission (FTC) and state attorney general’s are not getting involved in consumer abuse as much as they should be.

These numbers also show that many debt collectors are willfully violating federal and state law to collect debts. I could see if there were maybe 75-100 (total) filed each month, but the numbers of lawsuits that consumers file themselves without the aid of federal and state law enforcement is quite staggering.

Maybe it is a good idea that consumer issues such as the FDCPA and FCRA (Fair Credit Reporting Act) be taken away from the Federal Trade Commission and to a new consumer protection agency that is being currently being proposed in congress. From all outward appearances the FTC is failing US consumers in protecting them from predatory and illegal debt collection.

What’s more the $1000.00 per incident damages outlined in the FDCPA is chump-change to many of the the large US debt collection companies, hence the large number of federal lawsuits filed against them. The Fair Debt Collection Practices act needs to be beefed up and hit debt collectors hard, right in the wallet. Put some meat in the FDCPA and once a couple of large cash awards hit the debt collectors the illegal collection tactics will dry up to a trickle.

Now let’s take a look at how many Federal consumer credit lawsuits were filed against large debt collection companies and Debt Collection law firms so far in 2009.

January 1, 2009 through July 24, 2009

Asset Acceptance – 226 lawsuits

Allied Interstate – 215 lawsuits

NCO Financial Systems (Group) – 205 lawsuits

Palisades Collections, LLC – 153 lawsuits

Allied Interstate Inc. – 98 Lawsuits

-- the above totals 897 lawsuits close to 1/4 of the total number of consumer credit lawsuits filed in 2009 --

Client Services Inc – 65 lawsuits

Midland Funding/ Midland Credit – 65 lawsuits

Mann Bracken – 60 lawsuits

Portfolio Recovery Associates – 54 lawsuits

LVNV Funding – 46 lawsuits

MRS Associates – 38 lawsuits

United Collection Bureau (aka UCB) – 31 lawsuits

First Revenue Assurance – 26 lawsuits

Alliance One – 26 lawsuits

LTD Financial Services – 32 lawsuits

West Asset Management – 23 lawsuits

Mitchell N Kay PC – 23 lawsuits

Unifund CCR Partners – 20 lawsuits

Gerald E. Moore & Associates, P.C. – 19 lawsuits

Eskanos & Adler, PC – 13 lawsuits

Scott Lowery Law Office, P.C. - 11 lawsuits

Accounts Receivable Management – 10 lawsuits


Allen, Lewis & Associates, Inc – 5 lawsuits

I have probably overlooked a few of the larger debt collection law firms and debt collection companies, however as you can see it not just one or two lawsuits being filed against them, it is dozens and some hundreds. Feel free to search federal civil filings at (consumer credit lawsuits) and pull others you may have been abused by.

All these lawsuits filed against debt collectors in 2009 and in the last year the Federal Trade Commission has done nothing against any of them (so far as we know). It’s extremely sad if you ask me that consumers are being harassed and the very federal enforcement agency hasn’t done anything. No wonder debt collectors violate the law, they know that the FTC is going to do anything to them. I for one, am glad that congress is thinking of creating a new consumer protection agency and take some of the Federal Trade Commissions enforcement powers away. Like the old saying goes “Use it, or lose it” and the FTC only has themselves to blame…"

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