Fighting credit bureaus, creditors and debt buyers

Author Archives: christine

Finally, the appeals court decided my case against Midland, its attorneys and Equifax and

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I filed my appeal reply brief on 8/22 last year, can’t believe how long this took!

Docket Text:
FILED MEMORANDUM (MARY M. SCHROEDER, A. WALLACE TASHIMA and MILAN D. SMITH, JR.) The parties shall bear their own costs on appeal. AFFIRMED in part, REVERSED in part, VACATED in part, and REMANDED. FILED AND ENTERED JUDGMENT. [10546690] (GB)

2017-8-16–memorandum

I don’t understand AT ALL why Equifax was dismissed.

The district court did not abuse its discretion in denying Baker’s motion for a discovery extension because Baker failed to establish good cause, or that she was prejudiced by the denial.

That’s INSANE!   I was not allowed to conduct ANY discovery with Equifax, it FAILED to provide its initial disclosures and subsequently I lost my claims against Equifax.   Isn’t EVERYBODY supposed to be able to conduct discovery?  Aren’t initial disclosures MANDATORY?

This memorandum doesn’t even summarize the issues and it does not analyze the facts, but merely presents me with the decision.

I will probably pursue the discovery issue en banc because if I don’t, I won’t be allowed to do ANY discovery back in district court.

Texas jury imposed $25 million penalty against debt buyer Onwuteaka

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http://www.houstonchronicle.com/news/article/Jury-imposes-25-million-in-civil-penalties-11203956.php

… A state district court jury Wednesday imposed $25 million in civil penalties against a Houston debt buyer and the companies he controls for unscrupulous collection practices that included suing people who live far from Houston and were unlikely to show up in court to defend themselves. …

I read that they already filed their appeal, and on it goes.

I’m STILL waiting for a ruling on my appeal re Midland, its attorneys and Equifax.

CFPB Debt Collection Complaint Report

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It seems like we have a lot of complaints and statistics, but nothing ever changes:

CFPB Monthly Complaint Snapshot Spotlights Debt Collection Complaints

TABLE 13: MOST-COMPLAINED-ABOUT COMPANIES FOR DEBT COLLECTION
Company — 3 month average: Jul – Sep 2016 — % change vs. 3 month period last year — 3 month average — % untimely: Jul – Sep 2016

Portfolio Recovery Associates, Inc. 124.7 -8% 0%
Encore Capital Group 123.0 -34% 0%
ERC 83.0 -28% 0.4%
Citibank 77.3 12% 0%
Synchrony Financial 73.7 32% 0%
Capital One 69.0 47% 0.5%
JPMorgan Chase 65.0 31% 0.5%
Transworld Systems Inc. 62.0 -12% 0%
Convergent Resources, Inc. 49.3 21% 0%
Diversified Consultants, Inc. 48.7 30% 0.7%
Wells Fargo 42.3 76% 16%
I.C. System, Inc. 40.3 32% 0%
Bank of America 39.7 27% 0%
Navient Solutions, Inc. 39.0 19% 0%
Afni, Inc. 38.3 -8% 0%
Tenet HealthCare Corporation 37.7 122% 20%
Resurgent Capital Services L.P. 33.0 -3% 1%
Southwest Credit Systems, L.P. 32.0 146% 88%
National Credit Systems,Inc. 31.0 19% 5%
Commonwealth Financial Systems, Inc. 30.3 20% 2%
Pinnacle Credit Services, LLC 27.0 11% 0%
Barclays PLC 26.3 618% 0%
Cavalry Investments, LLC 26.0 -10% 0%
Hunter Warfield, Inc. 24.3 -3% 0%
Stellar Recovery Inc. 23.3 13% 0%
CCS Financial Services, Inc. 23.0 11% 1%
CL Holdings, LLC 21.0 11% 0%
Discover 20.0 43% 0%
The CMI Group, Inc. 19.0 30% 0%
Debt Recovery Solutions, LLC 18.3 67% 0%
Amex 16.3 96% 0%
EOS Holdings, Inc. 16.3 -40% 0%
I.Q. Data International, Inc. 16.3 53% 0%
ProCollect, Inc 16.3 36% 2%
The CBE Group, Inc. 16.3 -34% 0%

You can submit your complaint online at www.consumerfinance.gov/complaint/

Credit scores utilize phone data to determine risk

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From No Credit History? No Problem. Lenders Are Looking at Your Phone Data

… FICO’s partner EFL sends psychological questionnaires of about 60 questions to potential borrowers’ mobile phones. With Lenddo’s technology, FICO can check if users’ phones were physically present at their stated home or work address, and if they are in touch with other good borrowers — or with people with long histories of fooling lenders.

“We see this as a good opportunity to explore that type of data for risk assessment, as a viable means of extending financial inclusion,” David Shellenberger, a senior director at FICO, said in an interview.

“Financial inclusion?”   Debt. Interest. Fees. Stress.

… By checking phone records to see if a credit applicant associates with people with a poor track record of repaying loans, for example, lenders risk practicing discrimination on people living in disadvantaged neighborhoods….

Of course. It used to be called redlining and now they don’t even have to use your zip code or a map.

And if your parents have financial problems, don’t call them!

Business opportunities: 

“50 calls for $50.  I’ll call you 25 times and you get access to my phone #, just talk to my VM for a while.  My FICO is 800+ guaranteed!”  I should put up a “buy it now” button!

… Several large phone companies contacted by Bloomberg declined to comment about whether they share data with financial institutions, and few of the startups or financial companies were willing to disclose their telecommunications partners. …

Not surprising.

… “The way you use the phone is a proxy for the way you live,” Hakim said. “We are capturing a mirror of the customer’s life.” His company collects phone data — such as whom the potential borrower is calling and how frequently — from partners like Airtel Ghana, and crunches it for customers like Equifax, as well as marketers. It scores some 100 million consumers in 10 countries each month, Hakim said. Banks typically use such assessments alongside other evaluations to decide whether to grant a loan. Cignifi always gets customers’ permission to use data, he said. …

It doesn’t sound like they get permission from the people who the customer calls.

So someone else can give permission to the phone company to provide MY call data? 

… Startups like Lenddo, Branch and Tala have collected several years’ worth of data to prove that their methods of using mobile-phone data work — and that customers flock to them for help. Started in 2011, Lenddo, for instance, spent 3 1/2 years giving out tens of thousands of loans, in the amount of $100 to $2,000, in the Philippines, Colombia and Mexico to prove out its algorithms. Its average default rate was in the single digits, CEO Richard Eldridge said in an interview.

The company stopped offering lending in 2014, and stepped into credit-related services to financial institutions and banks in early 2015. Embedded into banking mobile apps, it can collect data on users with their consent. The company’s revenue is up 150 percent from last year, Eldridge said. ….

Yup.

So depressing.

I’ll focus on baking some organic cookies and growing veggies.

The Phoenix district court’s order granting the Midland and Equifax motions for summary judgment

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9-10-15 ORDER granting Midland and MCM summary judgment

Misnamed the doc, Equifax’s msj was also granted in that order.  I already uploaded most other relevant filings and will organize them on a separate page when I have some spare time.

My 5/11/16 opening brief re. my Midland, Equifax and Bursey & Associates appeal

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I’m sorry I haven’t posted in so long, but I’ve been extremely busy.

Last September the Phoenix district court dismissed ALL my claims against Equifax and Midland Funding / MCM.

I appealed and last night I filed my informal opening brief:

5-11-16–doc-12-Opening-Brief

After two weeks of doing not much else but read the orders and filings and doing a ton of research, my brain is fried and I have to attend to the gardens for a few days.

However, having to relive how I got railroaded in kangaroo court motivated me very much to update and post here again.

It’s incredibly that Equifax stepped up to defend Midland / MCM to get an obviously unjust dismissal.

The lies, the deceit … it’s so hard to find justice in the courts because the judges ACTIVELY  encourage the most deplorable practices such as Midland claiming that I failed to respond to their motion for judgment on the pleading re. my FDCPA claims when I had in fact THREE more days to reply.  Judge Campbell couldn’t have cared less …

My case was reassigned to judge Logan and he refused to extend the discovery deadlines even though none of the defendants objected (I attached their emails).

I NEVER got to see the Equifax initial disclosures and had LESS than 3 months from the Equifax and Midland/MCM answers to my amended complaint until discovery closed.

It’s so unfortunate that ALL we can do is appeal.  I ran across several FDCPA and FCRA cases in Arizona and it’s depressing to read those rulings.

A key issue with Midland / MCM is that they charged interest PRIOR to its ownership of the accounts.

When they sued me in justice court, I argued that it was an FDCPA violation to charge “pre-ownership” interest for my HSBC accounts (HSBC did not add interest to the accounts after they charged off).   So they “waived” all “prejudgment” interest in their motion for summary judgment to get a dismissal of my FDCPA claims.

Then they continued to report this “waived” interest to the credit bureaus and verified after my disputes in 2013 AFTER I sued them!  The nerve …

Most people with credit cards have received credits for late fees, over limit fees and interest due to whatever issues.  Imagine the uproar if the banks later ADDED these charges again!

If anyone has relevant case law regarding such a situation, please let me know!

FCC advises PayPal that its new policy violates the TCPA

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The FCC’s 6/11/15 certified letter to PayPal makes it clear that PayPal’s plan to exempt itself from the Telephone Consumer Protection Act violates the law.   This is rather timely as I’m getting ready to sue a collector who called my cell phone repeatedly for another person’s debt and I certainly did not consent to calls to my cell.

Here’s the letter: Continue Reading

Arizona statute of limitations — are checking accounts “open accounts” ?

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My last post was about overdraft credit lines.   But what about checking accounts?

I would think so since banks often PAY checks even with insufficient funds and therefore they extend credit (since they expect to get paid back.)

Is there any case law?

I would argue that the 3 year statute of limitations applies.

Overdraft credit lines are NOT credit cards and the 3 year SOL applies in Arizona

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A reader asked about the statute of limitations for an overdraft credit line tied to a checking account.

From my Midland Funding cross-motion for summary judgment in Arizona justice court regarding a CREDIT CARD, posted at the Litigation Forum:

  1. Midland‘s Claim Is Time Barred.

The Arizona legislature changed the statute of limitations for credit cards from 3 to 6 years in 2011. The new law became effective on 7/20/11. [DSOF 4] Therefore, the 3-year statute of limitations applies to the alleged debt as it was not subject to a written agreement [DSOF 5] and all my credit card accounts were “open” accounts:

ARS 12-543 Oral debt; stated or open account; relief on ground of fraud or mistake; three year limitation
There shall be commenced and prosecuted within three years after the cause of action accrues, and not afterward, the following actions:

  1. For debt where the indebtedness is not evidenced by a contract in writing.
  2. Upon stated or open accounts other than such mutual and current accounts as concern the trade of merchandise between merchant and merchant, their factors or agents, but no item of a stated or open account shall be barred so long as any item thereof has been incurred within three years immediately prior to the bringing of an action thereon. [emphasis added]

I have not used any credit card that I later defaulted on after June 2008 [Affidavit ¶2, DSOF 6]. Midland filed the complaint on June 11, 2012. [DSOF 7]

Pursuant to ARS 12-505, an action barred by pre-existing law is not revived by amendment of the law:

ARS 12-505. Effect of statute changing limitation

  1. An action barred by pre-existing law is not revived by amendment of such law enlarging the time in which such action may be commenced.

This action is time barred:

  • Midland failed to produce a written contract and it can not produce a written agreement as I did not have written contracts with any of my credit card issuers. [Affidavit ¶3, DSOF 5]
  • Midland can not possible document charges less than 3 years prior to 7/20/11, the effective date of the new 6 year statute of limitations [Affidavit ¶2, DSOF 6]
  • Time barred actions are not revived by amendment of the law.
  • Midland filed suit on 6/11/12, when the action was already time barred.

Attached hereto is DSS Financial v. Deborah Walrod as Exhibit A.   On 1/15/09 The Maricopa County Superior Court concluded on appeal that the action for a First USA credit card was time barred as the last charge occurred over 3 years prior to the filing of the lawsuit.

In LVNV Funding v Leslie Thompson, Exhibit B, the Maricopa County Superior Court ruled on 2/15/08 that a claim for a Sears charge card was time barred because the last charge occurred over 3 years prior to the filing of the lawsuit.

Even if Midland could provide admissible evidence to document its claim, this action would be time barred.

The court dismissed Midland’s claim because the SOL had expired.

In the reader’s case, I would argue that the 3-year statute of limitations for open accounts applies, provided that the debt buyer failed to provide a written contract. A credit line is not a credit card as defined by ARS A.R.S. § 13-2101,

12-543. Oral debt; stated or open account; relief on ground of fraud or mistake; three year limitation

Hope that helps!

PS: I would also always challenge the authenticity of debt buyer documentation such as bills of sale, account docs, etc. as I prevailed against debt buyer Acarta because they could not establish standing (the AZ court of appeals remanded after superior court had granted the Acarta motion for summary judgment.)

Midland Funding interest fraud documented

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I’ve been working on my responses to the Midland and Equifax motions for summary judgment.  One of my FCRA claims revolves around the Midland verifications of incorrect balances with Equifax.

Midland had sued me in justice court and I realized that Midland charged interest from the date of chargeoff — NOT from the date it purchased the account.  In justice court, Midland decided to not seek any interest in its motion for summary judgment to avoid further investigation of its practice to charge illegal interest.

When I sued Midland after its lawsuit was dismissed (expired SOL), Midland provided NO documents at all in response to my discovery requests.  After several failed attempts to get them to cooperate with filing a joint discovery motion, they finally provided me with documents on the evening before the doomed settlement conference.

From the 8/18/2014 MCM Supplemental Responses to my Request for Production of Documents, Document # 4, Account #1:

MCM-SupplResponse-Production-doc-4-acct1-pub-web

Purch. from HSBC BANK NEVADA, N. A. on 1/26/10, purch. bal. = $2,260.41

Charge-Off Date: 12/31/2008

Charge-Off Balance:  2,260.41

Interest Method:  Interest accrued from charge-off date

As per Arizona state law creditors can charge 10% interest.   Obviously, a creditor can NOT charge interest PRIOR to its purchase of an account.  And that’s exactly what Midland is doing.

Midland charged 10% interest for over two years – while it did NOT own the account! 

HSBC was one of the credit card issuers who did not charge interest after an account was charged off (unlike Capital One, which purchased the HSBC credit card portfolio).

In 2003 I sued Capital One and the credit bureaus because they refused to report the Cap One credit limits and this practice could significantly lower FICO scores.   Due to my relentless publication and litigation, several class actions were filed and finally all credit bureaus reported the Cap One credit limits around 2007.  I sure hope it won’t take several years for Midland to be sued into oblivion!

ALL Midland judgments that include these fraudulent interest charges should be vacated and all collection accounts should be cancelled. 

And of course all consumers who PAID these fraudulent interest charges deserve compensation.