CFPB Issues Consent Order for Alleged Illegal Actions

A company and its former owner reportedly violated the FDCPA and Consumer Financial Protection Act for threatening legal action against consumers in an attempt to collect debt.

4/6/2021 8:00 AM

NewsCFPB
CFPB Issues Consent Order for Alleged Illegal Actions

The Consumer Financial Protection Bureau has issued a consent order against Yorba Capital Management LLC (Yorba) and its former owner, Daniel Portilla Jr., for violations of the Consumer Financial Protection Act of 2010 (CFPA), according to a news release. The CFPB also reports that Yorba violated the Fair Debt Collection Practices Act. The consent order permanently bans both Yorba and Portilla from the debt collection business, and orders restitution and penalties, according to the news release.

Among other violations of the CFPA, the CFPB states in its consent order that, since January 2017, Yorba mailed litigation notices to consumers to attempt to collect debt.

“These letters falsely represented that consumers would be sued and that there would be further legal action if the consumers did not pay the debt amount on the notices. The litigation notices were likely to mislead consumers acting reasonably under the circumstances. The litigation notices contained statements that either explicitly or by implication threatened that a lawsuit would be the ‘next step’ to ‘collect this debt’ and that ‘further legal action’ would be taken if the consumer did not pay the debt amount stated on the notice, when, in fact, [Yorba] did not sue consumers to enforce the debt as part of its business or even hire attorneys to file such lawsuits. Because respondents did not file lawsuits against consumers to collect debt, respondents also did not obtain any judgments or collect on any such judgments, contrary to the implications in the litigation notice.”

Among reported violations of the FDCPA listed in the consent order, the CFPB reports Yorba “mailed litigation notices to consumers to collect debts that falsely threatened legal action against consumers if they did not pay the debt.”

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 will continue to work with the CFPB and other regulators to help them understand the complex issues that legitimate debt collectors face and will continue to urge a crack down on truly illegal actors. ACA 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.


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 comm@acainternational.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.


Subscribe to ACA Daily NEWSROOM

CFPB Issues Consent Order for Alleged Illegal Actions

The Consumer Financial Protection Bureau has issued a consent order against Yorba Capital Management LLC (Yorba) and its former owner, Daniel Portilla Jr., for violations of the Consumer Financial Protection Act of 2010 (CFPA), according to a news release. The CFPB also reports that Yorba violated the Fair Debt Collection Practices Act. The consent order permanently bans both Yorba and Portilla from the debt collection business, and orders restitution and penalties, according to the news release.

Among other violations of the CFPA, the CFPB states in its consent order that, since January 2017, Yorba mailed litigation notices to consumers to attempt to collect debt.

“These letters falsely represented that consumers would be sued and that there would be further legal action if the consumers did not pay the debt amount on the notices. The litigation notices were likely to mislead consumers acting reasonably under the circumstances. The litigation notices contained statements that either explicitly or by implication threatened that a lawsuit would be the ‘next step’ to ‘collect this debt’ and that ‘further legal action’ would be taken if the consumer did not pay the debt amount stated on the notice, when, in fact, [Yorba] did not sue consumers to enforce the debt as part of its business or even hire attorneys to file such lawsuits. Because respondents did not file lawsuits against consumers to collect debt, respondents also did not obtain any judgments or collect on any such judgments, contrary to the implications in the litigation notice.”

Among reported violations of the FDCPA listed in the consent order, the CFPB reports Yorba “mailed litigation notices to consumers to collect debts that falsely threatened legal action against consumers if they did not pay the debt.”

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 will continue to work with the CFPB and other regulators to help them understand the complex issues that legitimate debt collectors face and will continue to urge a crack down on truly illegal actors. ACA 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.


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 comm@acainternational.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.


Subscribe to ACA Daily NEWSROOM

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