Consumer Finance Insights
September 26, 2019

CFPB Files Suit Against Debt Collector for FCRA Violations

​On September 25, the Consumer Financial Protection Bureau (CFPB) filed suit in the U.S. District Court for the District of Maryland against a Maryland-based debt collector, its subsidiaries, and its CEO.  According to the CFPB, the companies operated the largest debt-collection company in the multi-unit housing industry, collecting debt on behalf of large apartment complexes, student and military housing, and assisted-living facilities.

The CFPB alleges that the debt collectors violated the Fair Credit Reporting Act, Fair Debt Collection Practices Act, and the Consumer Financial Protection Act by furnishing information to consumer-reporting agencies without maintaining reasonable policies and procedures to ensure its accuracy and integrity, failing to conduct reasonable investigations of consumer disputes, and collecting debt without a reasonable basis to assert it was owed.  The debt collectors allegedly outsourced their investigation and response to disputes submitted by consumers to credit reporting agencies to several employees in a call center in the Philippines, who the CFPB alleges were responsible for responding to dozens of disputes each hour.

The CFPB seeks an injunction, damages, redress, disgorgement of ill-gotten gains, and civil money penalties.

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