The Attorney General of Pennsylvania yesterday announced she has filed a lawsuit against the owner of 20 apartment complexes, accusing it of unlawful leasing and illegal debt collection practices.
The Background: When tenants moved out of their apartments, the defendant would allegedly issue threatening collection notices, which demanded payment of any move-out charges that exceeded the amount of the consumer’s security deposit within 15 days.
- The notice included the statement, “ANY UNPAID BALANCE WILL BE REPORTED TO THE CREDIT BUREAU AND WILL AFFECT YOUR CREDIT RATING IF NOT PAID WITHIN 15 DAYS.”
- Payments were to be made not to the defendant, but to the collection operation it was using. In fact, the letters went as far as to inform consumers to “DO NOT CONTACT THIS DEPARTMENT CONCERNING YOUR BALANCE” and that is was not responsible “for any types of threats, harassment or illegal practices done to you, your family, or your employment by a collection agency.”
The owner was also charged with inflating the costs that renters were required to pay if repairs needed to be made when the renters moved out. State law in Pennsylvania limits the costs that landlords can charge to the price of the actual damages. Leases from the defendant indicated the cost for labor and materials would be 1.5 times the actual cost that was paid.
The Claims: The owner of the buildings did not report the unpaid balances to the credit reporting agencies at all — the collector it placed the accounts with was charged with doing that, according to the complaint.
- The defendant is charged with violating Pennsylvania’s Consumer Protection Law.
