Asset Recovery Associates (ARA) Unfair Debt Collection and RICO Class Action

This class action is brought against Asset Recovery Associates, or ARA, and the complaint’s allegations read like a comic book account of the kind of behavior the Fair Debt Collection Practices Act (FDCPA) prohibits. The complaint doesn’t stop there, however. It claims that ARA’s behavior and its use of telephone communication for its fraudulent purposes are also violations of the Racketeering Influenced Corrupt Organizations (RICO) Act.

Plaintiffs Kimberly King and Daknesia Beard dispute their separate debts. However, the complaint claims that neither of them were given the right to do so that is guaranteed by the FDCPA, and neither were given the notices required of debt collectors by the FDCPA.

In King’s case, the complaint says, ARA threatened to sue her over the debt and to garnish her wages and/or bank accounts if she did not pay immediately. However, because of the age of King’s debt, ARA was not legally able to do so.

In Beard’s case, the complaint claims that ARA told her that it was “a representative of Harris County” and that check fraud charges would be pursued against her if she did not pay what she owed. Beard was given another number and told to call it to discuss her repayment options, the complaint says, but when she called, the same voice answered but identified itself as a representative of ARA.

When Beard explained that she believed the account had been paid in full, the complaint claims, the person hung up on her. When she called back, the complaint alleges she was told she had to pay $200 immediately or be charged with check fraud. When she said she did not have the money at the money, the representative told her she would have check fraud on her record and hung up on her again.

Two classes have been proposed for this action.

The RICO Class is all persons in Texas who, between June 8, 2014 and June 8, 2018, received fraudulent pretenses, representations, or promises from ARA similar to those above, via wire communication in interstate or foreign commerce, for the purposes of causing them to pay ARA money.

The FDCPA and Texas Finance Code Class is all persons in Texas who, between June 8, 2017 and June 8, 2018, were contacted by ARA to collect a debt, where

  • ARA or its agents represented that ARA was acting as law enforcement or that the person would face criminal charges if the account was not repaid;
  • ARA or its agents represented that the person would soon be served with legal process when in fact there was no present intent to do so;
  • ARA failed to disclose that the communication was from a debt collectors;
  • ARA failed to provide meaningful disclosure of its identity; or
  • ARA failed to provide one or more of the notices required by 15 USC § 1692g within five days of the first communication with the person. 
Article Type: Lawsuit
Topic: Consumer
No case events.
Tags: FDCPA, Failure to Identify Company as Debt Collector, Failure to give proper notice of thirty-day dispute period, Misrepresentations or False Statements