Consumer Finance Insights
September 22, 2018

Washington AG Sues Collection Agencies for Collecting on Debts Without State License

On September 21, 2018, the Attorney General for the State of Washington announced a lawsuit against three debt collection agencies and their owner, alleging that they violated the state’s Collection Agency Act, RCW 19.16.100 et seq., and the state’s Consumer Protection Act, RCW 19.86.010 et seq.

The complaint, filed in the King County Superior Court, alleges that the companies purchased charged-off debt accounts for pennies on the dollar and sued Washington consumers to collect the full face value with costs and fees, despite lacking a license to operate as a collection agency ​​​in Washington. The complaint further alleges that although they were not authorized to collect debts in Washington, they secured thousands of debt collection judgments against Washington consumers and used them to garnish wages, seize funds from bank accounts, and foreclose or threaten to foreclose on consumers’ homes.

The lawsuit seeks a permanent injunction preventing defendants from continuing to collect on these debts and an order that defendants file satisfactions of judgment as to the debts, as well as civil penalties of up to $2,000 per violation, restitution, disgorgement, and fees and costs.