Product: Debt collection

THE CFPB BROUGHT ACTIONS AGAINST THE PRA FOR THE VERY SAME REASONS. I AM REQUESTING THE SAME REMEDY PLEASE SIITE THE CASE AND PERFORM THE REQUESTED REMEDY The Consumer Financial Protection Bureau ( Bureau ) brings this action against Portfolio Recovery Associates , LLC ( PRA ) and alleges the following : INTRODUCTION 1. PRA is a debt collector whose principal purpose is the collection of debts. PRA also furnishes consumer information to consumer-reporting agencies ( CRAs ). 2. PRA collected millions of dollars using illegal debt-collection practices and engaged in unlawful credit-reporting practices that have impacted at least hundreds of thousands of consumers. 3. This is the second enforcement action that the Bureau has brought against PRA. In the first, the Bureau found that PRA violated multiple provisions of Federal consumer financial law, including the Consumer Financial Protection Act of 2010 ( CFPA ) and the Fair Debt Collection Practices Act ( FDCPA ), through its debt-purchase and collection practices. The Bureau resolved those findings through an order, to which PRA consented, issued on XX/XX/XXXX in In re Portfolio Recovery Associates , LLC ( Administrative Proceeding File No. XXXX ) ( the Order ). The Order required PRA to abide by certain conduct provisions. 4. Since the Order went into effect, PRAs debt-collection practices have violated numerous Order provisions, along with the CFPA and the FDCPA. PRA collected on at least tens of thousands of debts that consumers disputed even though PRA did not take the required steps to substantiate the accuracy and validity of those debts. PRA collected on numerous debts without informing consumers the debts were too old to legally enforce or report to a CRA. When notifying consumers that they could be sued, PRA failed to offer to provide consumers with certain required documents. On hundreds of occasions, PRA failed to timely provide the documents it did offer. PRAs failure to offer and timely supply the requisite documents likely affected consumers decision-making about whether to pay allegedly outstanding debts. And PRA sued thousands of consumers when it lacked proper documentation about the debt, and at times sued on debts that were too old. 5. Through these illegal practices, PRA collected millions of dollars from consumers. 6. Because inaccurate reporting can negatively affect a consumers financial opportunities, the Fair Credit Reporting Act ( FCRA ) and its implementing Regulation V require furnishers like PRA to promptly and adequately respond when a consumer disputes the accuracy of a debt. In violation of these requirements, PRA failed on numerous occasions to timely respond or reasonably investigate when consumers disputed debts. For a period, PRAs operations for processing and recording Direct Disputes were insufficient, resulting in thousands of disputes being ignored for months. On at least tens of thousands of additional occasions, PRA did not timely investigate and resolve Direct Disputes or timely notify consumers when it would not investigate because it believed the disputes were frivolous. And on numerous occasions, PRA conducted inadequate investigations of fraud and identity theft disputes. Consumers who were unable to correct errors on their reports may have paid more for credit or been denied credit, employment or housing. 7. The Bureau brings this action under the CFPA, 12 U.S.C. 5531, 5536 ( a ), 5564, 5565 ; the FDCPA, 15 U.S.C. 1692a, 1692e, 1692l ; FCRA, 15 U.S.C. 1681s-2 ; and Regulation V, 12 C.F.R. 1022.42-1022.43, to stop PRAs unlawful conduct, to obtain redress for harmed consumers and an appropriate penalty, and to obtain all other appropriate relief. JURISDICTION AND VENUE 8. This Court has subject-matter jurisdiction over this action because it is brought under Federal consumer financial law, 12 U.S.C. 5565 ( a ) ( 1 ), presents a federal question, 28 U.S.C. 1331, and is brought by an agency of the United States, 28 U.S.C. 1345. 9. Venue is proper because PRA is located, resides, or does business in this district. 12 U.S.C. 5564 ( f ). PARTIES 10. The Bureau is an independent agency of the United States charged with regulating the offering and provision of consumer-financial products and services under Federal consumer financial law. 12 U.S.C. 5491 ( a ), 5563, 5564. 11. The Bureau has independent litigating authority to enforce these laws. 12 U.S.C. 5564 ( a ), ( b ). 12. PRA, a wholly owned subsidiary of publicly traded PRA Group , Inc., is one of the largest debt collectors in the United States. Its principal place of business is in Norfolk, Virginia. At all times relevant to this Complaint, PRA has transacted business in this district. 13. At all times relevant to this Complaint, PRA has collected debt related to consumer-financial products or services and is therefore a covered person under the CFPA. 12 U.S.C. 5481 ( 6 ) ; see also 12 U.S.C. 5481 ( 5 ) & ( 15 ) ( A ) ( x ). 14. At all times relevant to this Complaint, PRA has been a debt collector within the meaning of the FDCPA. 15 U.S.C. 1692a ( 6 ). 15. At all times relevant to this Complaint, PRA has furnished consumeraccount information to CRAs for inclusion in a consumer report and has been a furnisher within the meaning of FCRA and Regulation V. 12 C.F.R. 1022.41 ( c ). The consumer-report information or other account information that PRA has collected and furnished to CRAs is used or expected to be used in connection with a decision regarding the offering or provision of a consumer -financial product or service, and furnishing this information is a service offered or provided for use by consumers primarily for personal, family, or household purposes. This activity is a consumerfinancial product or service under the CFPA. 12 U.S.C. 5481 ( 5 ), ( 15 ) ( A ) ( ix ). FACTUAL BACKGROUND The Bureaus Order Against PRA 16. On XX/XX/XXXX, the Bureau entered the Order against PRA concerning PRAs purchase and collection of debt. 17. The Order resolved claims that PRA was making false or unsubstantiated representations to consumers about owing debts ; misrepresenting that PRA intended to prove debts if consumers contested them ; filing misleading affidavits in debt-collection actions ; misrepresenting that PRA had legally enforceable claims to debts outside of the applicable statutes of limitations ; misrepresenting that attorneys had reviewed a consumers debt or that collectors were calling on behalf of attorneys ; and misrepresenting that litigation was planned, imminent, or even underway when PRA had not decided whether to file suit. The Bureau found that PRAs practices violated the CFPA and the FDCPA. 18. The Order required PRA to pay at least {>= $1,000,000} in consumer redress and an {$8.00} XXXX civil money penalty and to stop collections on over {$3.00} XXXX worth of judgments. 19. The Order also prohibited PRA from ( 1 ) representing the amount or validity of a debt unless PRA could substantiate the representation ; ( 2 ) selling debt ; ( 3 ) threatening or filing collection lawsuits without an intent to prove the debt ; ( 4 ) filing false or misleading affidavits in debt-collection actions ; ( 5 ) making false or misleading representations ; and ( 6 ) suing on Time-Barred Debt ( as defined in the Order ) or otherwise collecting Time-Barred Debt unless PRA complied with specified disclosure requirements . 20. The Order included numerous conduct provisions to ensure that PRA would adhere to these prohibitions. PRA Represented the Validity or Amount of Unsubstantiated Debt 21. Paragraph 116 of the Order prohibited PRA from making any representation, expressly or by implication, that a Consumer owes a Debt to [ PRA ] or as to the amount of a Debt unless, at the time of making the representation, [ PRA ] can substantiate the representation. 22. Paragraph 116 of the Order further provided that, whenever a consumer disputed the accuracy or validity of a debt, PRA could not make any further representations about the debts validity or amount until it had reviewed ( a ) Original Account Level Documentation ( OALD ) reflecting the Consumers name and the claimed amount excluding any post Charge-off or post-judgment payments ; or ( b ) if the claimed amount was higher than the charge-off balance or judgment balance, OALD reflecting the Charge-off Balance or judgment balance and... an explanation of how the claimed amount was calculated and why such an increase [ was ] authorized by the agreement creating the Debt or permitted by law. 23. Paragraph 16 of the Order defined OALD as ( a ) any documentation that a Creditor, or that Creditors agent ( such as a servicer ) provided to a Consumer about a Debt ; or ( b ) a complete transactional history of a Debt created by a Creditor, or that Creditors agent ( such as a servicer ) ; or ( c ) a copy of a judgment, awarded to a Creditor. 24. From at least XX/XX/XXXX to XX/XX/XXXX, PRA made at least tens of thousands of representations about an unsubstantiated debt whose amount or validity a consumer had disputed without reviewing the necessary OALD and information. 25. For some of these disputed debts, PRA did not possess and thus did not review OALD reflecting the consumers name and claimed amount at the time of the dispute, but nonetheless resolved the dispute in its favor and renewed collections of the unsubstantiated debt. 26. For other of these disputed debts, PRA represented the amount or validity of the debt while the dispute was pending and PRA had not reviewed OALD to substantiate the debt. Case 2:23-cv-00110 Document 1 Filed 03/23/23 Page 6 of 25 PageID # 6 7 PRA Engaged in Legal Collections Without Offering, Providing, or Possessing the Requisite Documents 27. Paragraph 15 of the Order defined Legal Collection as any collection efforts made by [ PRAs ] internal legal department or a Law Firm to collect [ PRAs ] Debt, including but not limited to sending letters on Law Firm letterhead and filing Debt Collection Lawsuits. 28. Paragraph 11 of the Order defined Debt Collection Lawsuit as any lawsuit filed by [ PRA ], or on behalf of [ PRA ] by a Law Firm, against any Consumer for the purpose of collecting any Debt. PRA initiated Legal Collections without offering to provide required documents. 29. Paragraph 119 of the Order prohibited PRA from initiating a Debt Collection Lawsuit unless it possessed ( a ) OALD reflecting the consumers name, account number, and claimed amount ; ( b ) OALD reflecting the terms and conditions applicable to the debt if the suit included a breach-of-contract claim ; ( c ) a listing of prior debt owners ; ( d ) a certified or other properly authenticated copy of each bill of sale or other document evidencing the transfer of ownership of the Debt at the time of Chargeoff to each successive owner ; and ( e ) either a signed document evidencing the opening of the account or OALD reflecting a purchase, payment, or other actual use. 30. Paragraph 120 ( e ) of the Order prohibited PRA from engaging in Legal Collections without previously providing a statement to the consumer that the consumer could request and would receive within 30 days all the documents PRA would need to possess, per paragraph 119 of the Order, when initiating a Debt Collection Lawsuit. 31. From at least XX/XX/XXXX to XX/XX/XXXX, PRA sent to millions of consumers, at the time of commencing Legal Collections, a form letter that offered only some of the required documents. This letter did not offer a certified or other properly authenticated copy of each bill of sale or other document evidencing the transfer of ownership of the Debt at the time of Charge-off to each successive owner, and it offered to provide only available OALD, meaning it would not provide OALD reflecting the name and claimed amount if it did not possess such a document. 32. After initiating Legal Collections, PRA did not make any other offer to consumers to provide the documents required under paragraph 119 of the Order. PRA misrepresented that it would provide the specified documents within 30 days. 33. Paragraph 122 of the Order prohibited PRA from making any material misrepresentation or omission or assisting others in making any material misrepresentation or omission, expressly or by implication. 34. The form letter that PRA has provided since at least XX/XX/XXXX when commencing Legal Collections has stated that, upon receipt of a written request from the consumer, PRA would provide within 30 days of request the documents enumerated in PRAs letter, including either a signed account application or account statements reflecting a purchase, payment or other use of the account. 35. On at least hundreds of occasions since XX/XX/XXXX, PRA did not provide to the consumer all documents offered in its form letter within 30 days of receiving a consumers written request for the documents. 36. PRAs false representations about providing documents within 30 days impeded consumers ability to determine whether a debt was truly owed and were likely to affect consumers decision-making about whether and how to respond to allegedly outstanding debts.