The Connecticut Department of Banking has reduced the fine against a law firm that was operating in the state without a consumer collection agency license to $20,000 from $100,000, largely on the basis that the law firm is no longer in business.
A copy of the order with the Law Offices of David M. Katz can be accessed by clicking here.
The state conducted an investigation back in 2022 and issued a temporary order to cease and desist, a notice of intent to issue order to cease and desist, a notice of intent to impose a civil penalty, and a notice of a right to a hearing. The firm had 14 days to respond to the notice in order to request a hearing, and that if a request was not made, an order would likely be forthcoming. During its investigation, the state discovered back in 2019 that the firm was conducting unlicensed collection agency activity for about 10,000 Connecticut accounts with a total balance of $1.4 million. The firm allegedly collected about $81,000 of that amount. The state sent the firm a certified letter and asked for a response, which was never provided. The state fined the firm $100,000 in December of 2022.
Last April, the attorney contacted the state and requested that it reconsider its final order, informing the department that, due to extraordinary circumstances, the law office was no longer in business. Seeking to resolve the matter without admitting or denying any of the allegations, the firm represented that it ceased all collection activity in Connecticut after receiving a letter from the department in December 2019 and no longer collects in the state. The firm also assured the department that the violation will not occur again in the future.
In issuing the $20,000 fine, the state vacated the previous order from 2022.
