CFPB and New York Attorney General Issue Proposed Settlements with Debt Collection Group
Settlements for alleged violations of state and federal laws include consumer redress and permanent ban from acting as debt collectors.
7/25/2019 8:30 AM
The Consumer Financial Protection Bureau and the New York Attorney General filed proposed settlements with debt collectors for alleged violations of state and federal debt collection laws, according to a news release from the CFPB.
The individuals and companies, Douglas MacKinnon, Northern Resolution Group, LLC, Enhanced Acquisitions, LLC, Delray Capital, LLC, and Mark Gray, are debt-collectors who conducted business together based in Buffalo, New York.
“Under the proposed settlement with MacKinnon, Northern Resolution Group, and Enhanced Acquisitions, they will be banned from the industry and must pay $60 million. Under the proposed settlement with Delray Capital and Gray, they will be banned from the industry and a judgment for civil money penalties and redress will be entered against them,” according to the CFPB.
The news release also states:
In the complaint filed in federal court in 2016, the bureau and New York Attorney General alleged that the defendants violated the Consumer Financial Protection Act of 2010; the bureau alleged that the defendants violated the Fair Debt Collection Practices Act; and the New York Attorney General alleged that the defendants violated New York laws in connection with the collection of consumer debt, placement of consumer debts for collection, and related activities.
The bureau and the New York Attorney General alleged that Northern Resolution Group and Enhanced Acquisitions are debt collection companies created and operated by Douglas MacKinnon, and that Delray Capital is a debt collection company created and operated by MacKinnon with Gray.
The complaint alleged that since at least 2009, the companies together purchased millions of dollars’ worth of consumer debt, inflated those consumer debts, and relied on illegal tactics to extract as much money as possible from consumers for their debts.
Under the proposed settlements, all defendants would be permanently barred from acting as debt collectors. All defendants also would be enjoined from engaging in any misrepresentation or omission in connection with any consumer financial product or service.
Under the terms of the proposed settlement with MacKinnon, Northern Resolution Group, and Enhanced Acquisitions, those defendants also would pay $40 million in redress to consumers and a $10 million civil money penalty to both the Bureau and New York, for a total penalty of $20 million.
Under the terms of the proposed settlement with Gray and Delray Capital, the order would impose a judgment for redress of $4 million, a judgment for civil money penalties of $1 million to the Bureau, and a judgment for civil money penalties of $1 million to the New York Attorney General. As explained in the proposed order, full payment of those amounts would be suspended subject to those defendants paying a $1 civil money penalty to the Bureau and $10,000 for consumer redress.
When there are admissible facts evidencing egregious conduct, ACA International supports law enforcement and regulators’ efforts to target bad actors, stop illegitimate debt collection activity, and safeguard consumer rights by removing known violators from the financial marketplace. ACA has worked consistently with the CFPB and other regulators to help them understand the complex issues that legitimate debt collectors face, and takes pride in its frequent and varied industry compliance educational services and offerings in support of the overwhelming majority of legitimate debt collectors who operate lawfully, take consumer protection seriously and play a unique and much-needed role in our credit-based economy.
View the CFPB’s news release for more information and links to judgments and orders for the defendants.
Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to firstname.lastname@example.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.
Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.