Midland Credit Management Unclear Debt Owner Class Action

The Fair Debt Collection Practices Act (FDCPA) intends to prevent the third-party debt collectors from confusing or misleading consumers. The complaint for this class actions alleges that certain collection letters from Midland Credit Management, Inc. (MCM) violate the law by making the current creditor or owner of the debt unclear, thereby putting consumers in danger of fraud or double payments.

One of the purposes of the FDCPA is to require that certain information be given to consumers by debt collectors, in a manner that is clear and not misleading, either in the initial contact from the debt collector or within five days of it.

MCM is part of one of the largest company families of debt buyers and collectors in the US. Its parent company, Encore Capital Group, Inc. has a very large portfolio of distressed consumer debt. The complaint claims, “According to Encore’s 2013 Form 10-K, Encore spent more than $525 million to purchase consumer credit card accounts in the U.S. As Encore paid less than 10 cents on the dollar, the face value of those accounts is in the tens of billions of dollars.”

In this case, both plaintiffs allegedly owed debts incurred for personal, family, or household purposes.

Plaintiff Dianna Oleson received a letter dated May 20, 2019 regarding a debt she allegedly owed to MCM. The letter listed the “Original Creditor” as Synchrony Bank (USA) NA. This alleged debt was possibly incurred by the use of an Amazon-branded credit card for personal, family, or household purchases.

The letter claims, in a summary of account details, that the current owner of the debt is MCM. The reverse side of the letter repeats that MCM is the “Current Creditor” and “sole owner of this debt[.]” However, the body of the letter offers to provide documentation, upon request, “evidencing the transfer of ownership of the account to Midland Funding…”

Plaintiff Ann Zarczynski received a letter dated May 31, 2019 regarding a debt she allegedly owed to MCM. The letter listed the “Original Creditor” as Capital One Bank (USA), NA. This alleged debt was possibly incurred by the use of a credit card for personal, family, or household purchases.

The letter claims, in a summary of account details, that MCM is the current owner of the debt. The reverse side of the letter repeats that Midland Funding is the “Current Creditor” and “sole owner of this debt[.]” The body of the letter, however, offers to provide documentation, upon request, “evidencing the transfer of ownership of the account to Midland Funding…”

The complaint thus says that both letters are therefore unclear about who is the current owner or party to whom the debt in question is owed. The complaint alleges, “Confusing and misleading representations about the name of the creditor are material misrepresentations because they create the potential for fraud or double-payments.”

Article Type: Lawsuit
Topic: Consumer

Most Recent Case Event

Midland Credit Management Unclear Debt Owner Complaint

May 19, 2020

The Fair Debt Collection Practices Act (FDCPA) intends to prevent the third-party debt collectors from confusing or misleading consumers. The complaint for this class actions alleges that certain collection letters from Midland Credit Management, Inc. (MCM) violate the law by making the current creditor or owner of the debt unclear, thereby putting consumers in danger of fraud or double payments.

Midland Credit Management Unclear Debt Owner Complaint

Case Event History

Midland Credit Management Unclear Debt Owner Complaint

May 19, 2020

The Fair Debt Collection Practices Act (FDCPA) intends to prevent the third-party debt collectors from confusing or misleading consumers. The complaint for this class actions alleges that certain collection letters from Midland Credit Management, Inc. (MCM) violate the law by making the current creditor or owner of the debt unclear, thereby putting consumers in danger of fraud or double payments.

Midland Credit Management Unclear Debt Owner Complaint
Tags: FDCPA, Failure to Clearly State Name of Creditor, Misleading or Confusing Debt Collection Letter, Unlawful Debt Collection