Alexander J. Douglas, Esq. | Attorney | (585) 703-9783 |   alex@rochesterdebtlawyer.com

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Companies Pay Millions in Illegal Autodialer Text Message Lawsuits

Did you know that companies are not allowed to use an autodialer to send text messages to your phone without your consent?

Federal law gives you the right to sue a company that is sending text messages to your phone without your consent.  Under this law, the Telephone Consumer Protection Act (TCPA), you are entitled to up to $1,500 per unwanted text message.

Some companies are spending millions of dollars to settle class action lawsuits for these kinds of violations.  Recently, a taxi cab company agreed to settle a class action for illegal text messages for a total of $5.3 million, plus over $1 million in attorneys’ fees.

Despite these huge settlements, some companies do not get the message that they are not allowed to send illegal text messages to your cell phone without your consent.  Sometimes, these companies buy lists of cell phone numbers from marketers to try to sell their goods and services to you, and assume that you will not know your rights.  Other times, the companies are just unaware of these consumer protection laws designed to protect you from inconvenience.

The same law also says that consumers can get up to $1,500 per unwanted call to their cell phone if the call was made with an autodialer.

How do you know the call was made with an autodialer?

  • Some common indications include receiving calls twice in a row, calls at the same time each day
  • A large number of calls, a “click” noise when you answer, or having the caller hang up when you answer

Bottom line, these companies do not count on you knowing your rights when they are violating the law.

We here at Gesund & Pailet have helped several consumers with bringing lawsuits under the TCPA, and we stand ready to help anyone else who is being bothered and harassed by these companies.

Federal Government Sues Navient for Collection Violations

Recently, the Consumer Financial Protection Bureau (CFPB), the main federal regulator of debt collectors and financial organizations, sued Navient in federal court for extensive mistakes and violations relating to its debt collection behavior. The CFPB also sued one of Navient’s largest debt collection companies, Pioneer Credit Recovery, Inc. The attorneys general in Washington and Illinois joined the lawsuit.

Some people might not recognize the name Navient, but they almost definitely have heard of Sallie Mae. Sallie Mae spun off Navient several years ago to operate as its debt collection arm of the company. Navient oversees the collection of billions of dollars’ worth of student loans, both federally insured and private.

If you fall behind on your federally insured student loans, federal law guarantees you the right to enter into an “income-based repayment” (IBR) program, where you can make monthly payments on your loans for a small percentage of your income.

According to the lawsuit, Navient employees steered consumers away from entering into these beneficial programs.  In addition to steering borrowers away from these plans, the CFPB also accused Navient of neglecting to inform borrowers of the deadlines for their IBR plans, forcing millions of their borrowers to fail to renew their plans on time. As a result, their loans went back into traditional payment in full, where some consumers had to pay several thousand dollars a month.

Also, the CFPB accused Navient of applying consumers’ payments incorrectly, sometimes applying the payments to student loans which were accruing a lower rate of interest, and leaving the accounts with the higher rate untouched.

These are just some of the accusations leveled against Navient by CFPB. Navient has been a huge player in the student loan field for several years now.

We here at Gesund & Pailet stand ready to help consumers who are having problems with their student loan collectors.

Federal Trade Commission enforcement of Phantom Debt Collection

This week, the Consumer Financial Protection Bureau (CFPB) released its annual 2017 report to Congress about the Fair Debt Collection Practices Act (FDCPA). The CFPB reported that the Federal Trade Commission (FTC), who also helps to enforce the FDCPA, brought or settled 12 different lawsuits against debt collectors in 2016, which focused mainly on phantom debt collection and unlawful text messages.

Phantom debt collection refers to debt collectors attempting to collect debt that does not actually exist. Thousands of consumers are impacted by this unlawful practice annually.

In 2016, the CFPB obtained $39 million in restitution for consumers, with debt collectors paying an additional $20 million in civil penalties relating to FDCPA violations.

Debt collectors may also violate the Telephone Consumer Protection Act (TCPA) by sending text messages to the cell phones of consumers where they do not have the consent to do so. If a court finds that this law is violated, the debt collector could be liable for up to $1,500 per unlawful text message.

In 2017, the CFPB released two different studies on the debt collection industry, including a white paper about online debt sales, and a report on Consumer Experiences with Debt Collection, based on the CFPB’s reviews of consumer views on debt collection.

The CFPB also noted that consumer debt has continued to increase since 2013, and is approaching the peak that it once held in 2008. (Consumer debt includes debt for family and household purposes, including credit cards, student loans, and medical bills.)

As a consumer, you  should know that you have rights under the FDCPA to prevent debt collectors from using any harassing, abusive, or misleading communications when they are collecting debt. Consumers may be entitled to up to $1,000 for such violations, plus attorneys’ fees and costs required to bring the case. Because the law provides for attorneys’ fees, I can usually take these type of cases on contingency.

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