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DISCLAIMER: This article is based on a complaint. The defendant has not responded to the complaint to present its side of the case. The claims mentioned are accusations and should be considered as such until and unless proven otherwise.
This class-action lawsuit isn’t so much against the collection operation that is trying to recover the debt; it’s more against the Consumer Financial Protection Bureau because of how it designed the Model Validation Notice. A collection operation is facing a class-action lawsuit in Georgia because it sent the plaintiff a Model Validation Notice that indicated that $663.40 in interest had accrued on the debt since the itemization date, but there was no mention in the notice whether interest was still accruing and whether the amount that was now owed was higher.
The background: The industry saw a lot of these lawsuits a few years ago. Known as “Avila” lawsuits, they were popular before Regulation F went into effect, but the creation of safe harbor language related to whether interest was accruing on a debt that collectors could include in their letters to consumers put the kibosh on most of those claims. Until now, it seems.
- Last October, the plaintiff received a Model Validation Notice from the defendant. The itemization table indicated that as of November 10, 2020, the plaintiff owed $4,402.58, which included $663.40 in interest.
- It was clear in the notice that interest had accrued and there was no mention that interest had stopped accruing.
- This left the plaintiff confused, according to the complaint, whether the total amount of the debt in the notice was accurate or not. If she paid the $4,402.58, would that satisfy the obligation?
- The complaint accuses the collector of failing to provide proper notice of the amount of the debt that was due and whether it was subject to continued interest accrual.
The claims: The complaint accuses the defendant of violating Sections 1692e(2), 1692e(2)(A), 1692e(10), 1692f(1), and 1692g(a)(1) of the FDCPA.
- The complaint seeks to include anyone else living in Georgia who received a letter from the defendant that included an amount of interest that was greater than zero where the letter failed to inform the recipient that either interest was continuing to accrue or that it had been explicitly waived.
