The Attorney General of Massachusetts yesterday announced a lawsuit against Credit Acceptance Corp., a subprime auto lender, for knowingly originating loans to individuals even though it knew they would be unable to repay them, and then said the lender “harassed” those individuals by calling them as many as eight times a day in attempting to collect on unpaid debts, which is a violation of state law.
A copy of the complaint, filed in state court in Massachusetts last Friday, can be accessed by clicking here.
Skipping ahead through the part where the Attorney General accused Credit Acceptance of defrauding as many as 24,000 borrowers in Massachusetts and said it is seeking damages of $5,000 per violation — or $120 million in total — the lawsuit says that the auto lender violated state law that limits how many times an individual can be contacted 1.5 million times. State law limits no more than two calls per day can be made to an individual with an unpaid debt.
Those 1.5 million calls that are alleged to have violated state law occurred during a four-year period between 2014 and 2018, according to the complaint. About 90% of the time, Credit Acceptance was alleged to have called individuals at least twice a day. The lender was alleged to have made at least five calls per day to 28% of individuals with debts owed to the company, according to the complaint.
Maura Healey, the Attorney General of Massachusetts, said in a statement
