Michigan Collection Law Blog

In the last few months, I have noticed that I have been getting similar emails from people who claim to be stuck over seas (usually in Japan, they say) and would like me to enforce their divorce settlement. This mornings' read like this:

Name: Jennifer Lunyang Email: aaxtos@yahoo.com Phone: +81-3-3423-8001 Interested In: Dear Counsel,

I am contacting your firm in regards to my divorce settlement with my ex husband (Frank McCain) who resides in your country. I am currently relocated to Japan because of financial problems which I encountered after he abandoned us in Europe. We had an out of court agreement for him to pay $380,000.00 plus legal fees. He has only paid me $24,000 since which was not enough to settle the bills,legal fees and the childrens school fees .I am hereby seeking your firm to represent me in collecting the balance from him.

He has agreed already to pay me the balance but it is my belief that a Law firm like yours is needed to help me collect the payment faster from my ex-husband or litigate this matter if he fails to pay as promised. The payment has been overdue for over 3months.

I await your urgent response and also let me know what your rates are as well as your agreement /retainer form.

Sincerely,

Jennifer Lunyang

I highly doubt that there is a Jennifer Lunyang in Japan. Her account is at yahoo.com. I would suspect that if she were stuck in Japan, that she would have a more Japanese sounding ISP hosting her free email account.

I dont know for a fact as to how the scam works, but I can easily see her having me send a demand letter to her "ex- spouse" and magically, i get a check for a huge amount of money. Presciently, she notifies me that she learns that her ex has sent me the money and then tells me a sob story about how she is destitute and needs her share as soon as possible and if wouldn't mind send it her ASAP. It would only be after I deposited the check and sent her the share, that I learned that the underlying check is bogus.

Attorneys - please be careful of this scan. its the newest flavor for getting hurt.

In Foti v NCO Financial 424 F. Supp2d 643 (S.D.N.Y. 2006), the United States District Court in New York properly held that all communications from a debt collector must contain a warning that it is a communication from a debt collector. The Fair Debt Collection Practices Act (FDCPA) , itself, at 15 U.S.C. 1622e requires this. However, the FDCPA also prohibits a debt collector from communicating about the debt with anyone other than the debtor, the debtor's spouse or attorney at 15 U.S.C. 1892(c)(b). In Foti, the debt collector attempted to reach the debtor by leaving a message. The court held:

"Thus, .given the choice of language by Congress, the FDCPA should be interpreted to cover communications that convey, directly or indirectly, any information relating to a debt, and not just when the debt collector discloses specific information about the particular debt being collected.

The court's language in Foti would appear to taint any voicemail message left by a debt collector as a violation of the FDCPA. This may be, indeed an incredibly broad view of the word "communication: under the FDCPA and this court's opinion has no formal binding precedential value outside of 2nd Circuit...BUT....the law in this area is far from settled and the District Court in 2nd Circuit stepped up to the plate and rendered an opinion. Any other circuit that is presented with this same issue will undoubtedly review the Foti case and its well reasoned opinion in formulating its own holding. This case is one large strike against debt collectors leaving messages. In my opinion, I would not wait for strikes 2 and 3 before advising my consumer debt collector clients to NOT leave messages on debt collectors' phones.

My question is then, is why would any debt collector in his or her right mind ever leave a voicemail message for a debtor? I think the short answer is that no collector with some familiarity with Foti would ever leave a message for a debtor. Yes, I understand that the telephone is still the number one tool for collect debts without litigation. I also understand the value of auto dialers in debt collection agencies. What I don't understand is why a collector would leave a message for a call back today.

Here is my best advice to you Consumer Debt Collectors and Attorneys who collect consumer debt - DON'T LEAVE VOICEMAIL MESSAGES FOR YOUR DEBTORS. Its just not worth the risk of getting hit with an FDCPA action.

Mr. Yaple, a California collection attorney represents (or may be represented) a California collection agency called TK Financial. Ms. Vlach, an Ohio consumer received a letter from Attorney Yaple in May of 2008 in which he informed her that he had been retained by TK Financial to pursue a debt against her. The letter also said that he intended to sue her and collect costs of the litigation and attorneys' fees. The letter was not signed by Mr. Yaple himself, but rather a typed signature. She is suing Mr. Yaple for violation of the Fair Debt Collection Practices Act.

She also presented the court with two emails that purportedly came from Yaple that represented that he intended to file a lawsuit against her.

Mr. Yaple contends that he did not compose these communications. Rather, he states that a rogue collector at TK Financial had created mock letterhead and set up an email account. In any event, he is now in trouble whether he is culpable or not. Although he is a California attorney, he was to defend himself in federal court in Ohio as a defendant in a class action. The case has since been settled and dismissed. Missing from the court's docket was Mr. Yaple's third party complaint against TK Financial and the allegedly rogue collector. This glaring omission speaks to whether there was truly a rogue collector or whether Mr. Yaple was pimping out his letterhead.

Continue reading "Collection Attorneys - Do NOT pimp out your letterhead to your collection agency clients" »

Today my good friend and occasional opposing counsel, Charity A. Olson and I gave a speech to the Oakland County Bench/Bar convention. I sue debt collectors under the Fair Debt Collection Practices Act and Charity defends them. She is as good as it gets when it comes to defense counsel. We presented a joint talk from both of our perspectives. Its was great fun, until....I took a question from Chiara F. Mattieson. She is a collection attorney with Holzman, Ritter and Corkery, PLLC.

During my speech, I informed the crowd how I had located a ghost debtor on Facebook. A ghost debtor is someone who is off the grid. He has no home address that I could find, no car registered in his name and no real estate. I could not find this guy until I found him on Facebook and then I was able to locate all sorts of information on him. Anyways, I sent this debtor a friend invitation which he accepted. Ms. Mattieson then asked me "Weren't you required to give him the mini-Miranda when you send your friend invitation on FB?" This requirement under the FDCPA is where you have to warn a debtor that your communication to him is from a debt collector.

Boy...she got me right there...on the spot...uh...uh....may be. She might have been right. But, as I thought about it through lunch, it occurred to me that no, I did not need to give this guy the mini-Miranda when I sent him a friend invitation through FB because my communication was not in connection with the collection of a debt.

After lunch, I saw Chiara in the parking lot. As some of you may know, I hold a first degree black belt in karate. I told Chiara that as long as we were in the parking lot....that I had an answer for her question. She was as gracious and friendly as could me as we discussed the pros and cons of the Fair Debt Collection Practices Act.

Kudos to Holzman Ritter and Corkery for hiring as an intelligent and astute attorney as Chiara Mattieson. Chiara, if you read this post, I want you to know that it is attorneys like you that make me proud to be part of our profession. You intellectually challenged me and by making me thinking through an answer, you made me that much of a better lawyer. Thank you.

I will be ready for yournquestions next time! :)

For the past several years, I have blogged about issues affecting debt collectors and their opponents, consumers. Some people have taken issue with the fact that I help both the proverbial Coyote and Road Runner. Too bad. Running a successful law firm such as Nitzkin and Associates has its advantages such as taking the cases that I want to take and representing the people that I want to represent.

I have decided to form an division in my firm dedicated strictly to helping consumers; its called Michigan Consumer Credit Lawyers. The website is still under construction. When it is complete, I will let you know. I anticipate that it will be live in the next few weeks. This new website will contain several self help videos for consumers on issues from what to do when they get sued to how to handle an abusive debt collector. Take heart as we also republishing our Nitzkin and Associates website with many instructional videos too.

The MCCL blog is already up at www.micreditlawyerblog.com. On this new blog, I will talk only about issues that affect consumers who have been wronged by debt collectors, banks, credit reporting agencies and anyone else that would treat a consumer like crap. MCCL's website will be up shortly to coach consumers on what to do when they are faced down by their larger and financially better heeled opponents. We are here for them to even those odds.

We are still and will always be debt collection attorneys. However, we mostly represent businesses and do commercial debt collection and hence, we really have no conflict of interest. I, Gary Nitzkin, will continue to write this blog coaching debt collectors on how to avoid violating the FDCPA and the FCRA.

If you have any questions, please feel free to email me, Attorney Gary Nitzkin or call me, tool free at 877-293-2882.

Attorneys, when you file a complaint under the Fair Credit Reporting Act ("FCRA"), be sure that you can make the following allegations in good faith:

a. Your client posited its consumer dispute with the credit reporting agency (and not just the creditor/furnisher directly). You or your client's failure to notify the credit reporting agency of your client's dispute is fatal to your FCRA claim. You see, under the statute, a credit reporting agency's duty to conduct a reasonable reinvestigation does not begin until it receives notice of the dispute. Notifying the furnisher of the dispute is insufficient to trigger any duty to conduct a reasonable reinvestigation by the credit reporting agency.

b. Be sure to plead that that the credit reporting agency notified the furnisher of your dispute. If you are uncertain as to whether this happened, look for facts that would support a good faith believe to allege that this happened "upon information and belief." Under the FCRA, a furnisher's duty to conduct its reinvestigation is not triggered until the credit reporting agency notifies it of your client's dispute. Some courts do not require this to be pled in the complaint, but yet, some courts do. For example, Judge Avern Cohen who sits in the United States District Court for the Eastern District of Michigan requires this allegation in FCRA complaints. I just finished reading an opinion in which he dismissed the Plaintiff's complaint for failing to allege that the credit reporting agency notified the furnisher. I have a world of respect for Judge Cohen and his opinions. I can safely say that he is an incredibly intelligent man and history will undoubtedly remember him as an excellent jurist. BUT......if you are going to file an FCRA complaint in the Eastern District of Michigan and your case is assigned to Judge Cohen, be sure that you follow my advice.