Consumer complaint received 2019-07-17 00:00:00
Product: Debt collection — Payday loan debt
Issue: False statements or representation — Attempted to collect wrong amount
Company: TekCollect Inc.
State: CA

Complaint narrative:
XX/XX/2019 RE : FRAUD AND MISREPRESENTATIONS BY TEK-COLLECT INCORPORATED CONSUMER COMPLAINT To THE CONSUMER FINANCIAL PROTECTION BUREAU : XXXX XXXX XXXX became aware of TekCollects service through the executive director of the XXXX XXXX XXXX XXXX XXXX, XXXX XXXX. He explained that his son, XXXX XXXX, had been working in the collections industry for several years and had created a strategy or business model that effectively collected payday advance checks. XXXX explained XXXX had recently been hired by TekCollect to promote this new service within the check cashing and payday advance industries. Further, we were told the company offered a money-back guarantee on their pre-paid collection service. 

Shortly thereafter, XXXX XXXX contracted with TekCollect employee, XXXX XXXX, about providing services to multiple store owners within the XXXX XXXX franchise system. He described the terms of the servicethat the company would guarantee four times the initial investment in collections, or a refund would be made. These werent representations being made to our franchisees by XXXX XXXX, XXXX, these were being made to them directly by an employee of TekCollect. 

As a result of these enticements, several franchisees across the country including mine signed up with TekCollect and submitted the requisite pre-payment fee and 100 outstanding checks. TekCollects employee, on behalf of TekCollect, made representations numerous times to XXXX XXXX, XXXX and to many of our franchisees, that if the company could not collect the payday advance checks submitted, a refund would be made. 

As time went by, it was discovered that the collections werent coming back as represented. When asked, TekCollect employees said the store owners simply needed to submit additional checks, that the four times collections would be generated or a refund paid. More time, and more uncollected checks, but few or no collections resulted. Never once did XXXX XXXX or anyone else from TekCollect tell XXXX XXXX, XXXX or the franchise owners they were submitting checks improperly. 

Eventually our XXXX franchisee, XXXX XXXX, requested a refund. TekCollect promptly denied his refund. He was told he needed to submit additional checks. He had submitted more than two times the initial number of bad checks. Few, if any, were collected. After many back and forth communications with XXXX XXXX, Mr. XXXX threatened to sue TekCollect. TekCollect finally relented and made good on its refund guarantee and sent Mr. XXXX a check. 

Two months more passed since we also asked for a refund and TekCollect refused to respond. XXXX XXXX, XXXX has conducted some additional investigation. It appears that Connecticut and as many as four other states have allegedly issued Cease and Desist orders against TekCollect for this or other similar misrepresentations or inappropriate collection efforts. 

The CFPB has a reputation for taking financial abuse and scams very seriously. Our franchise owners were promised one level or performance with a money-back guarantee and did not receive that performance. Now TekCollect is refusing to live up to its contractual money-back obligation. I hope you find our complaint worthy of further investigation, possibly resulting in shutting down TekCollects operations in California. Small businesses such as ours should not be victimized by such blatant fraud and misrepresentations. Thank you. 


Very truly yours, XXXX XXXX XXXX, XXXX

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation