The Consumer Financial Protection Bureau has sued a group of San Diego-based debt collection companies over violations of several consumer financial protection laws.
Encore Capital Group, Inc. and its subsidiaries — Midland Funding, LLC; Midland Credit Management, Inc., and Asset Acceptance Capital Corp. — were operating under a 2015 consent order from the CFPB over alleged violations of the Consumer Financial Protection Act, the Fair Debt Collection Practices Act and the Fair Credit Reporting Act.
The CFPB alleges the companies both violated that consent order and committed additional FDCPA and CFPA violations. Specifically, the companies sued consumers without possessing required documentation, used law firms and an internal legal department to engage in collection efforts without providing required disclosures, and failed to provide consumers with required loan documentation after consumers requested it, the bureau said.
Encore and its subsidiaries also violated the consent order, the CFPA, and the FDCPA by suing consumers to collect debts even though the statutes of limitations had run on those debts and violated the consent order by attempting to collect on debts for which the statutes of limitations had run without providing required disclosures, the bureau said.
The CFPB further alleges that the companies violated the CFPA by failing to disclose possible international-transaction fees to consumers, thereby effectively denying consumers an opportunity to make informed choices of their preferred payment methods. The bureau also alleges that each violation of the consent order constitutes a violation of the CFPA.
With annual revenue exceeding $1 billion and annual net income exceeding $75 million, they together comprise the largest debt collector and debt buyer in the United States.