The Attorney General of Washington has reached a settlement with a collector that it sued last year, which will see the collector pay $1.6 million in fines and restitution to consumers for allegedly deceiving them by making settlement offers in collection letters even though the collector could not enforce the debt in court. More importantly, the collector has agreed to stop using the words “settle” or “settlement” when attempting to collect on time-barred debts without disclosing that the statute of limitations has expired.
A copy of the settlement agreement with Convergent, based in Renton, Wash. can be accessed by clicking here.
The collector will repay 80,285 consumers who received a letter with a settlement offer and who made at least one payment on their debts $355,000, ranging in amounts from $9 to $20,000, and will pay $1.32 million to the AG’s office to cover the costs of investigating the allegations as well as future monitoring and enforcement of the settlement.
“Debt collectors are not allowed to deceive Washingtonians,” said Washington Attorney General Bob Ferguson, in a statement. “Today’s resolution holds this large, sophisticated debt collection corporation accountable for its unlawful conduct that put its profits above the law.”
The original lawsuit accused the collector of allegedly violating Washington’s Collection Agency Act and Consumer Protection Act by creating a “deceptive impression” that the company would sue to collect on the debts when it could not.
That the collector has agreed to stop using certain words in its letters should be of interest to anyone collecting in Washington state for sure, and perhaps anywhere in the country. It is likely that other Attorneys General or plaintiff’s attorneys may pick up on this settlement and use it as a means of going after other collectors.
