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Encore Capital Group Settles Debt Collection Claims from Massachusetts Attorney General

Encore Capital GroupEncore Capital Group says the settlement allows the company to move forward, noting that it proactively engaged with the attorney general throughout the process.

09/26/2022 10:20 A.M.

2 minute read

The Massachusetts Attorney General, Encore Capital Group Inc. and its subsidiaries, Midland Funding LLC, Midland Credit Management Inc. and Atlantic Credit and Finance Inc., have reached a settlement to resolve allegations of unfair and deceptive debt buying and debt collection practices.

The assurance of discontinuance, filed in Suffolk Superior Court, with Encore Capital Group Inc. and its subsidiaries alleges violations of state laws in the attorney general’s debt collection regulations.

The settlement resolved the attorney general’s investigation into “numerous unfair and deceptive debt buying and debt collection practices by Midland,” according to a news release.

Under the terms of the settlement, Midland is required to pay $4.5 million, which includes restitution to thousands of impacted Massachusetts consumers, and will reform its debt collection practices. Additionally, Midland will cease to collect on over 4,200 debts, totaling approximately $7.5 million, that were previously placed with the Daniels Law Office and for which a judgment could not be verified.

Midland will be prohibited from collecting on debts or suing any consumer for a debt unless the company can acquire and review all original documents relating to the debt. The company must also come into compliance with the attorney general’s debt collection regulations pertaining to debt collection calls, time-barred debt, and validation of debts. The company has also agreed to additional protections for consumers who rely on exempt income. Among those protections, the company will not attempt to have consumers enter into court-ordered agreements to pay debts with exempt income and will not seek court payment hearings for consumers with only exempt income.

In response to the settlement, Encore Capital Group issued the following statement:

“As a company driven by its vision to help consumers restore their financial health, we’re pleased to put this case—which principally concerned conduct that occurred years and years ago—behind us. This settlement allows us to move forward, and we’ve made it clear that any allegations of wrongdoing brought against us are ones we strongly deny. We proactively engaged with the Attorney General of Massachusetts throughout the process because we believe we share a common goal: to do right by consumers. We are pleased to resolve this decade-old investigation so we can redouble our efforts on our mission to help create pathways to economic freedom for those we serve.”

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