June 26, 2006

Michigan Collection Law - Collection Agency gets nailed by NY Attorney General

Collection Industry reports reports that "Attorney General Eliot Spitzer today announced that his office has filed a lawsuit against a debt collection company alleged to have engaged in illegal and abusive practices to coerce payment on time-barred or unverified debts.." There is nothing new about a collection agency that engages in abusive practices. In its report, Mr. Spitzer has accused JBC & Associates, P.C. and its successor companies, JBC Legal Group, P.C. and Boyajian Law Offices, P.C., and their operator, Jack H. Boyajian of New Jersey are accused of violations of both federal and state laws regarding debt collection practices.

The allegations against the agency include threating to sue on checks when they had no such intention to do so. It also appears that the agency would attempt to bully their debtors with questions such as "do you look good in stripes?" intimating that criminal action would be taken against them.

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Posted In: Collection Agencies breaking the law

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June 16, 2006

IRS's Plan to use private collectors is halted

When Congress passed the American Jobs Creation Act of 2004, it agreed to allow the IRS to hire private debt collectors to collect back taxes. Recently, the IRS's plan to employ two private debt collection agencies has been halted.

What is disturbing about this statute is that it does not provide any remedies to the taxpayer when faced with an abusive debt collector. In the consumer arena, a collector's behavior is governed by the Fair Debt Collection Practices Act. However, the FDCPA specifically excludes governmental agencies from its provisions. Thus, if a private collector working on behalf of the IRS, gets abusive, there is no federal statute that a consumer may use as a shield and counter-weapon. While it its true that the FDCPA applies only to consumer debts and thus, in a business setting, a collector is not controlled by the FDCPA in the commercial arena, business are usually not as unsophisticated as many consumers are. It may be that in the rush to secure tax dollars that are undoubtedly floating out there, Congress may not have thought this through.

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Posted In: Debt Collection Laws - Federal

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June 15, 2006

Prominent Debt Collection Law Firm hit with jury verdict

An interesting article in today's Credit and Collection Website details how a name partner at a prominent law firm was hit with a jury verdict of $2.9 million for collection tactics that the jury did not like. Bernard Plechaty, 82, of Fort Lauderdaule, Fla., filed the lawsuit, claiming that Bob Weltman's collection tactics (and presumably his firm's collection tactics), were improper and forced him into bankruptcy. Weltman was also hit with attorneys fees of $500,000.

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Posted In: Collection Law Firms in the News

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June 14, 2006

Michigan Debt collection Law Preempted again by the Feds?

In USA Today, an article reports that the House of Representatives is expected to vote next week a bill that would prevent you, as the consumer from freezing your credit report. Freezing one's credit report is the process of suspending further entries into your credit bureau in the event that your identity is stolen.

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Posted In: Debt Collection Laws - Federal

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June 13, 2006

Michigan Debt Collection Attorneys finally get a break in the bankruptcy court

The bank lobby finally got is way in Congress with the Bankruptcy Abuse Preventon and Consumer Protection Act of 2005. Hell, you would've had to have been living under a rock in October 2005, not to have noticed the flurry of bankruptcy filings made before the deadline of the new Act.

From a collection attorney perspective, the Act is really cool.

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Posted by Gary Nitzkin | | Email This Post

Posted In: Debt Collection Tricks and Traps

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June 8, 2006

Michigan Debt Collection Lawyer Tip - Fraudulent Transfers Trick and Trap

Michigan adopted the Uniform Enforcement of Fraudulent Transfers Act.( "UFTA"). In a nutshell, UFTA says that if your debtor, while owing you money, transfers his assets to someone else, you can sue that someone else to collect what is owed to you. But the Michigan Court of Appeals recently decided the case of Mather Investors v Maddock and Larson which may cause a new pitfall for collection attorneys.

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Posted by Gary Nitzkin | | Email This Post | Comments (0)

Posted In: Debt Collection Tricks and Traps

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