Debt Collection Agency Faces FDCPA Class Action Lawsuit

A proposed class action lawsuit has been filed against Collecto Inc., doing business as EOS CCA, alleging the debt collector engaged in multiple violations of the Fair Debt Collection Practices Act.

Plaintiff D.L. filed the class action lawsuit in New Jersey federal court on behalf of herself and others similarly situated.

“Congress enacted the FDCPA to ‘eliminate abusive debt collection practices, to ensure that debt collectors who abstain from such practices are not competitively disadvantaged, and to promote consistent state action to protect consumers,’” the lawsuit states.

D.L. alleges that EOS CCA violated the Act in a number of ways by its alleged use of misleading and deceptive representations in its collection of debts.

The plaintiff states that she received a debt collection letter with reference to her student loan in June 2015, listing her debt amount of $25,244.54 in total. The letter broke down the amount into a principal balance of $11,839.78, interest in the amount of $10,160.16 and “charges” of $3,244.60.

Upon placing a phone call to EOS CCA, D.L. allegedly told the company that she did not have sufficient funds to pay the debt. The debt collection agency reportedly agreed to settle the debt and consider the account as paid in full if D.L. paid $250 per month for 24 months to total $6,000.

D.L. claims she agreed with the amount and asked for a written letter that detailed the terms of the verbal agreement. However, EOS CCA did not send the requested letter.

EOS CCA sent D.L. a different letter reminding her that her credit card or check payment in the amount of $250 would be processed and interest was accruing on her account, which was stated to be $25,288.21, the court document reads.

Additional letters were sent to D.L., with one letter increasing her total debt owed to $35,492.04 and another listing her verbally approved payoff of $6,000, along with another part of the letter saying that she owed $25,121.58, according to the claim.

“Because Defendant had stated its acceptance of the $6,000 settlement agreement with the Plaintiff, its statements as to a total amount due was a false representation as to the amount of the debt,” the claim reads.

D.L. believes that EOS CCA has sent letters to at least 40 other consumers that have also received allegedly erroneous and misleading debt information.

“Upon information and belief, Defendant’s Payment Reminder and Settlement Confirmation Templates contain errors related to the total amount due and the itemization of the principal, interest, and charges due,” the complaint alleges.

The payments were made against an amount other than what was agreed on by D.L. in her phone conversation, and her total amount due was not adjusted based on the agreement, according to the plaintiff.

D.L. seeks to represent consumers in two Classes: 1) a Settlement Confirmation Class including individuals who received a letter from EOS CCA based on the Settlement Confirmation Template within the last year and 2) a Payment Reminder Class including individuals who received a letter from EOS CCA based on the Payment Reminder Template within the last year.

Six counts of violations of the FDCPA are alleged. In addition to class certification, D.L. is seeking declaratory relief, actual damages, additional damages, attorneys’ fees and costs and pre- and post-judgment interest, as well as any other relief deemed proper by the Court.

The plaintiff is represented by Justin Auslaender of Thompson Consumer Law Group, PLLC.

The EOS CCA Debt Collection Violations Class Action Lawsuit is D.L. v. Collecto Inc. dba EOS CCA, Case No. 3:16-cv-03269, in the U.S. District Court for the District of New Jersey.