Consumer advocates have been warning for years that bank debt collection tactics by third-party collection agencies are unfair, deceptive and abusive.
Now, the Consumer Financial Protection Bureau (CFPB) and the attorneys general of 47 states and Washington, D.C., have filed an enforcement action against one of the largest banks in the country for allegedly unfair credit card collection tactics.
The action outlines the systematic approach the bank reportedly took in collecting debts that were unverified, inaccurate, discharged in bankruptcy or were not collectible for other reasons.
Our Miami consumer protection attorneys understand the list of alleged transgressions is long.
Among allegations made:
The bank used documents that were illegally-sworn in obtaining court judgments against some 500,000 borrowers whose debts were not verified. In those cases, people may not have had the resources to fight back, and ended up getting slapped with a default judgment – owing a debt they should never have had to pay to start. The bank issued sworn statements promising the debts were valid and accurate, but in fact, the company failed on a consistent basis to review those records and make sure those statements were truthful.