Last Thursday, May 19, Encore Capital was sued by the Minnesota Attorney General for allegedly robo-signing false affidavits in collection cases. Testimony under oath from employee’s of Encore’s Midland funding LLC and Midland Credit Management Inc. revealed that they had signed up to 400 affidavits a day without reading them. A typical 8 hour work day contains 480 minutes which means they were signing about 1 every minute!
The lawsuit brought forth by Attorney General Swanson’s office alleges the company “aggressively filed thousands of lawsuits against individual citizens for collection of old, purchased debt, often supporting those lawsuits with robo-signed affidavits generated at its St. Cloud Offices.” In addition, Midland placed the burden on “individual citizens to prove they do not owe money instead of themselves substantiating that the citizens actually owe the money.” This is improper practice as collection agencies have to issue what’s known as a “verification of debt” to the debtor as proof of the obligation.
In a strong statement against the company Swanson said, “Midland has perverted the justice system by filing robo-signed affidavits in court and hounding citizens for debt they don’t owe.”
One giant collection agency has already stated it will no longer purchase and collect credit card debt. As rules and regulations become even tighter, others will leave as well opening up even more opportunity for those of us who planned for this and aligned ourselves with collection agencies ready to capitalize on the situation.