Consumer complaint received 2024-05-29
Product: Debt collection — Credit card debt
Issue: Attempts to collect debt not owed — Debt is not yours
Company: ENCORE CAPITAL GROUP INC. (CA)

Consumer Financial Protection Bureau Complaint IN THE MATTER OF, XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX MIDLAND CREDIT MANAGEMENT , XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX Respondents. 


COMPLAINT AND DEMAND FOR RELIEF I. INTRODUCTION Complainant, XXXX XXXX XXXX, a resident of XXXX XXXX, California, brings this complaint against Respondents XXXX XXXX XXXX XXXX ( " XXXX XXXX '' ), Midland Credit Management , XXXX ( " MCM '' ), XXXX XXXX XXXX XXXX ( " XXXX '' ), XXXX XXXX XXXX XXXX XXXX ( " XXXX '' ), and XXXX XXXX ( " XXXX '' ), for their egregious and repeated violations of the Fair Credit Reporting Act ( FCRA ), 15 U.S.C. 1681 et seq., the Fair Debt Collection Practices Act ( FDCPA ), 15 U.S.C. 1692 et seq., the Rosenthal Fair Debt Collection Practices Act ( RFDCPA ), and California 's Unfair Competition Law ( UCL ).

This complaint arises from Respondents ' systemic and blatant disregard for Complainant 's consumer rights, which has resulted in significant financial harm, emotional distress, and damage to Complainant 's credit standing. The violations detailed herein demonstrate a pattern of malicious, deceptive, and unfair practices that warrant the highest possible monetary relief and injunctive action by the Consumer Financial Protection Bureau ( CFPB ).

II. FACTUAL BACKGROUND On or about XX/XX/XXXX, Complainant opened a credit card account with XXXX XXXX. 

Subsequently, Complainant 's account was charged off by XXXX XXXX and assigned to MCM for collection.

From the outset, MCM engaged in a campaign of harassment and intimidation, employing tactics designed to coerce payment without regard for the accuracy of the debt or Complainant 's rights under federal and state law. 

XXXXXXXX XXXX collection efforts were marred by a series of false and misleading representations, including conflicting information about the account balance, payment due dates, late fees, and the status of the account. These inconsistencies created substantial confusion and XXXX  for the Complainant, making it impossible to ascertain the true nature of the debt or to effectively exercise their rights to dispute it. 

Compounding these issues, both XXXX XXXX and MCM repeatedly furnished inaccurate information to the major credit reporting agencies ( XXXX, XXXX, and XXXX ). These inaccuracies, which remained on Complainant 's credit reports for an extended period despite repeated disputes, have severely damaged Complainant 's creditworthiness and caused substantial financial harm.

Furthermore, MCM has been operating in California without a valid license, in direct violation of state law. This unlawful conduct underscores their disregard for legal and ethical standards and warrants additional scrutiny by the CFPB.

III. LEGAL CLAIMS A. Violations of the Fair Credit Reporting Act ( FCRA ) Respondents XXXX  XXXX and MCM violated the FCRA by furnishing inaccurate information to the CRAs, including misrepresenting the account balance, payment due dates, and the account 's status. ( See XXXX, XXXX, XXXX, XXXX, XXXX ) XXXX  XXXX further violated the FCRA by failing to provide Complainant with a notice of furnishing negative information when the account was charged off. ( See XXXX ) All Respondents violated the FCRA by failing to conduct a reasonable investigation into Complainant 's disputes regarding the accuracy of the information on their credit reports. ( See Dispute Results XXXX XX/XX/XXXX XXXX, Dispute Results XXXX XXXX XXXX XXXX  Dispute Results XXXX ) B. Violations of the Fair Debt Collection Practices Act ( FDCPA ) Respondent MCM violated the FDCPA by continuing to report the debt to the CRAs and engaging in collection activities despite Complainant 's ongoing dispute of the debt. ( See credit reports ) MCM further violated the FDCPA by engaging in collection activities in California without a valid license. ( See XXXX ) MCM engaged in deceptive and misleading practices by providing conflicting information about the account balance, payment due dates, late fees, and the status of the account. ( See XXXX, XXXX, XXXX, XXXX, XXXX ) MCM failed to validate the debt within 30 days of Complainant 's initial dispute, as required by the FDCPA. ( See Validation of Debt Letter dated XX/XX/XXXX ) C. Violation of the Rosenthal Fair Debt Collection Practices Act ( RFDCPA ) MCM violated the RFDCPA by engaging in collection activities in California without a valid license As evidenced by an email sent by MCM dated XXXX and again on XXXX proving 2 years of continued illegal collection activities in California ( See XXXX and MCM email XXXX ) D. Violation of California 's Unfair Competition Law ( UCL ) Respondents ' cumulative conduct, as described herein, constitutes unfair, unlawful, and fraudulent business practices in violation of the UCL.

E. Breach of Contract and Fiduciary Duty ( Against XXXX  XXXX ) XXXX  XXXX breached its contract with Complainant and its fiduciary duty to act in Complainant 's best interests by failing to maintain accurate records, providing misleading information, and unjustly charging off the account.

F. Defamation ( Against XXXX  XXXX and MCM ) XXXX  XXXX and MCM made false and defamatory statements about Complainant to the CRAs, harming Complainant 's reputation and creditworthiness. 


G. Fraud ( Against XXXX  XXXX and MCM ) XXXX  XXXX and MCM made false and misleading representations to Complainant regarding the debt, with the intent to deceive and induce payment. 


H. Intentional Infliction of Emotional Distress ( Against XXXX  XXXX and MCM ) The conduct of XXXX  XXXX and MCM, as alleged herein, was intentional, extreme, and outrageous. Complainant is an individual living with a total and permanent mental XXXX, and Respondents ' relentless and abusive collection tactics exacerbated this condition, directly contributing to multiple hospitalizations necessary to stabilize Complainant 's XXXX XXXX. This constitutes intentional infliction of emotional distress, causing Complainant severe and lasting harm. 












IV. DEMAND FOR RELIEF WHEREFORE, Complainant respectfully requests that the CFPB take the following actions : Order Respondents to cease and desist from all further collection activities related to this debt.

Order Respondents to correct all inaccuracies on Complainant 's credit reports with all three CRAs Order Respondents to pay Complainant the maximum amount of statutory damages allowed by law for each of the no less than 15 violations of the FCRA and FDCPA Consumer protection laws and for these funds to be paid from the CFPB civil penalty fund immediately preceding the review of this complaint verification of the evidence of the continued predatory practices of Midland credit management Order Respondents to pay Complainant actual damages, including reimbursement for all fees and charges, compensation for emotional distress, and damages to Complainant 's credit standing, including those damages incurred as a result XXXX XXXX  for the exacerbation of a pre-existing XXXX XXXX condition. 

Order Respondents to pay substantial punitive damages to deter future misconduct and the now common practice of considering small fines paid for repeated violations of the law merely a cost to operate a continued criminal Enterprise Order Respondents to disgorge all profits and benefits obtained through their unlawful conduct.

Refer this matter to the appropriate state and federal agencies for further investigation and enforcement action. 


Respectfully submitted, XXXX XXXX XXXX Dated : XX/XX/XXXX XXXX XXXX XXXX XXXX XXXX XXXX # XXXX XXXX, CA XXXX ( XXXX ) XXXX XXXX XXXX