The Attorney General of New York yesterday announced an Assurance of Discontinuance with a collection law firm and its subsidiary that will see it pay $655,600 in fines and restitution to consumers. The restitution — $595,000 of the total — will go to consumers who had judgments against them, but the firms failed to file satisfactions of judgment in a timely manner during the COVID-19 pandemic.
The AG’s investigation also uncovered instances where the law firms purportedly filed collection lawsuits against consumers that had already been resolved in Housing Court, where attorneys failed to review prior court history before filing lawsuits, and where they pursued debts that were already paid in full or partially paid.
- The AG’s investigation noted that the firm had filed 374 rental arrears cases between 2017 and 2020 without noting whether there was prior litigation, and five cases where it noted that there was prior litigation, but did not know the outcome. In 23 cases, it noted there was prior litigation and a money judgment, yet it went ahead with the collection lawsuit anyway.
- The AG’s office also found a handful of cases where the firm allowed files that had been closed internally to remain on a court’s docket and appeared for hearings or other court events on those cases.
- The firm was also accused of not having policies and procedures to require clients to produce payment records when assigning judgments to the firm for collection.
A response to the AG’s press release that shares more details from the law firm’s side can be accessed by clicking here.
Along with paying the fine, the firm also agreed to amend its practices to address the issues that were raised by the AG’s investigation.
