A District Court judge in Georgia has granted summary judgment in part and denied it in part in a lawsuit filed by the Consumer Financial Protection Bureau against a group of individuals and companies for engaging in a “robocall phantom debt collection scheme.”
The case, which was originally filed in 2015, has “changed dramatically” since then, according to Judge Richard Story of the Northern District of Georgia, Atlanta Division.
A copy of the 69-page ruling in the case of CFPB v. Universal Debt & Payment Solutions, et al., can be accessed by clicking here.
In filing the suit, the CFPB alleged that a group of individuals, led by Marcus Brown and Mohan Bagga, harassed individuals into making payments on non-existent debts, deceived consumers and threatened legal action against them. The CFPB took the additional step of also filing suit against service providers — telemarketing companies and payment processors — that were alleged to have ignored signs that they should have known the defendants were engaging in illegal activities.
Ultimately, the allegations against the payment processing and telemarketing companies were dismissed, and the case proceeded against the individuals and entities that were directly involved in the alleged scheme.
One of the corporate defendants — WNY Account Solutions — and three of the individual defendants — Marcus Brown, Sarita Brown, and Tasha Pratcher — did not respond to the CFPB’s motion for summary judgment, and Judge Story granted summary judgment in favor of the CFPB against those defendants.
Judge Story ruled the CFPB was not entitled to summary judgment against another corporate defendant — S Payment — because there were issues of material fact as to whether the company was part of a “common enterprise” and thus may not be liable for the deceptive acts of the other defendants.
Regarding the counts against Mohan Bagga and Sumant Khan, the judge ruled the CFPB was entitled to summary judgment.
