Minnesota AG Lori Swanson sues notorious collector Afni
YES!!!
July 15, 2008
Minnesota Attorney General Lori Swanson today filed a lawsuit in Hennepin County District Court against AFNI, Inc., an Illinois debt collection agency, for attempting to collect debts from Minnesota citizens who stated they did not actually owe the debts and for failing to substantiate debt that consumers stated they did not owe.
The lawsuit alleges that AFNI used unfair collection techniques to attempt to collect debts that Minnesota consumers stated they did not believe they owe, and that AFNI did not adequately verify the validity of debts to ensure it was collecting the debt from the right people. As a result, AFNI repeatedly contacted Minnesota consumers in an attempt to collect debts, some up to ten years old, that in some cases were not actually owed by the citizens.
“In this troubled economy, many people are struggling to pay their bills. Debt collectors are entitled to pursue payment of legitimate debts, but they must do so fairly and in compliance with the law,” Swanson said.
The lawsuit alleges that AFNI continued collection efforts, rather than verify the legitimacy of the debt, after citizens informed AFNI that it was attempting to collect the debt from the wrong person. In response to AFNI’s requests, Minnesota consumers sometimes provided private information, including social security numbers and police reports of identity theft, to prove that AFNI was collecting the debt from the wrong person, but that even after being provided with this requested information, AFNI sometimes continued its collection efforts.
AFNI also sometimes reported invalid “debts” to credit bureaus without verifying that the debts were actually owed by the citizen and did not take the action necessary to remove the debts from consumers’ credit reports.
The Minnesota Attorney General’s Office has published a Debt Collection Fact Sheet which offers tips for consumers who are contacted by collection agencies. The Attorney General’s Office provides the following tips in dealing with debt collectors:
Consumers have the right to dispute all or part of a debt if they believe that it is not owed. Once the debt is disputed, collectors must stop trying to collect the debt until the debt collector provides proof of the debt;
Collectors must inform consumers of their right to request verification of a given debt in writing within 30 days;
If a consumer tells a collector it has the wrong person and he/she does not owe the debt, the burden of proof shifts back on the collector to verify the debt; and
Collectors may not use false, deceptive, or misleading statements to collect a debt;
AFNI, Inc. is a private debt collector headquartered in Illinois that has operations throughout the country and is engaged in the business of debt collection.Consumers who believe that they were taken advantage of by AFNI, or another debt collector, may file a complaint with the Minnesota Attorney General’s Office by calling 1-800-657-3787 or 651-296-3353. Consumers may also download a Consumer Complaint Form by clicking here and returning the completed form to the Attorney General’s Office at: 1400 Bremer Tower, 445 Minnesota Street, St. Paul, MN 55101-2131.
Afni recently demanded more information from a client instead of properly validating the debt. Sending a notice with the amount owed and the name of the original creditor is NOT validation.
What’s NOT in the press release:
*** Afni usually reports the account as disputed to the credit bureaus as required by the FDCPA, but since FICO scores IGNORE the dispute notice, FICO score continue to be destroyed.
*** PAYING a collection reported to the credit bureaus as such will NOT increase FICO scores. While many people would just settle the accounts to make them go away, doing so would result in often much lower FICO scores.
*** Because collections are rated by FICO scores according to the DATE ASSIGNED, even very OLD collections can lower FICO scores by over 60 points.
Just about every 2nd client has an old Afni collection and I sure wish the so-called consumer advocate attorneys did their jobs. With Afni headquartered in Illinois, I don’t understand why Dan Edelman hasn’t filed a class action. On second thought, it’s probably not profitable enough due to the FDCPA class action damages restrictions.
I applaud AG Lori Swanson.
I’ve had CreditFactors subscribers post that her office assisted with the resolution of complaints about creditors and collectors and that rarely happens in any other state.
From her bio:
… In 2006, Ms. Swanson served as Chair of the Consumer Advisory Council to the Federal Reserve Board of Governors in Washington D.C. The Consumer Advisory Council, established by Congress in 1976, advises the Chairman of the Federal Reserve Board and the Board of Governors in consumer protection matters, including predatory lending, mortgage, banking, credit card marketing practices, credit scoring and credit bureau reporting, fraud and identity theft, and financial privacy. Ms. Swanson served as Vice-Chair of the Council in 2005 and a member in 2004. In 2007, Swanson testified in front of the Board in Washington D.C., urging it to take action to protect homeowners from predatory mortgage lending practices that lead to default, foreclosure, and economic turmoil. ...
It doesn’t look like anybody listened to her.
I should send her an open letter about the Afni credit reporting implication, but due to the lack of donations, I doubt I’ll get to it. Been extremely busy with the Focus appeal (will post shortly) and since I’m driving my nephew to the airport tonight, I’ll be taking a break from building and catch up on the many projects and suits.
Posted by Christine on 07/16/2008 at 10:23 AM
Credit - Collection - Economic News • (0) Comments • Permalink
