Money Recovery Class Action Alleges Unauthorized Collection Fees

Top Class Actions’s website and social media posts use affiliate links. If you make a purchase using such links, we may receive a commission, but it will not result in any additional charges to you. Please review our Affiliate Link Disclosure for more information.

Money Recovery Nationwide, a debt servicer, has been hit with a proposed class action lawsuit alleging the collection agency violated the Fair Debt Collection Practices Act and the Michigan Collection Practices Act by collecting unauthorized additional processing fees.

Plaintiffs Andrew Corey and Catherine Tubergen of Michigan are suing Money Recovery Nationwide (assumed name of Nationwide Collection Agencies) claiming the company falsely conveyed they had a legal right to charge a convenience fee on all electronic card payments while attempting to collect on consumers’ debt.

Essentially, both Corey and Tubergen incurred separate medical obligations but due to financial hardship, defaulted on the debts which were then subsequently transferred to Money Recovery Nationwide for collection purposes.

In May 2016, Corey claims he made a payment in the amount of $30 towards his $373.69 debt along with a $1.37 (1.55 percent + $.090) convenience fee on his credit card through Money Recovery Nationwide’s online payment portal. The convenience fee charged by the defendant totals 4.5 percent per the complete transaction.

Similarly, Tubergen made a payment towards her debt in the amount of $10 with a convenience fee of $1.06, which is 11 percent per the total transaction.

However, as part of the preliminary case investigation, it was determined that neither of the original obligations or creditors to whom the debts at issue were owed charge a convenience fee of “1.55% or an additional charge of $.090 for credit card payments and there is no contractual or legal obligation that debts be assessed such a convenience fee or additional $.090 charge,” the lawsuit states.

According to the plaintiffs, the payment portal automatically populates the convenience fee field and additional charge field and the debtor can’t opt out of paying the two fees. Furthermore, the lawsuit alleges that there is no information given to the debtors regarding why Money Recovery Nationwide is charging these mandatory fees or where the amount goes.

The Fair Debt Collection Practices Act (FDCPA) is a consumer protection statute that “imposes open-ended prohibition on false, deceptive, or unfair debt collection practices.”  Under the FDCPA, it is illegal for a debt collector to make a false representation or deceptive means to collect or attempt to collect any debt.

Both Corey and Tubergen allege that the demanded and required convenience fee set forth for the electronic credit card transactions made to Money Recovery Nationwide purposely and deceptively conveys that the debt servicer has the legal right to charge a credit card or check processing fee for payments when in fact such a fee is neither contractually authorized nor permitted under the FDCPA.

“It seems sensible to suggest that attempts such as those by the Defendant in this case to collect a ‘convenience’ fee from the Plaintiffs which it was not permitted by contract or law to collect from the Plaintiffs would have the effect of confusing a less sophisticated debtor such as the Plaintiffs, which it in fact did,” the lawsuit states.

The plaintiffs are seeking certification for a nationwide Class of consumers who were forced to pay a mandatory convenience fee of “1.55% + $.090” through Money Recovery Nationwide’s payment portal on its website at www.mrncollect.com where the original obligation “between the Plaintiff residents and the original creditor or state law does not authorize a mandatory payment of a convenience fee to be added when paying a debt to Defendant.”

Corey and Tubergen are requesting damages to be awarded in the amount of $1,000 along with court costs and attorneys’ fees for Money Recovery Nationwide’s alleged intentional and willful violation of numerous provisions of the FDCPA, including representing an amount not permitted in the debtor’s contract.

The plaintiffs are represented by Brian P. Parker of the Law Offices of Brian P. Parker and Nicholas A. Reyna of the Law Offices of Nicholas A. Reyna.

The Money Recovery Nationwide Class Action Lawsuit is Andrew Corey and Catherine Tubergen v. Money Recovery Nationwide (Nationwide Collection Agencies Inc.), Case No. 1:16-cv-00481-JTN-ECS in the U.S. District Court for the Western District of Michigan.