Encore, Midland Class Action Says Debt Collectors Falsify Forms

A class action filed on May 24, 2016 alleges that several debt collection companies filed lawsuits that were not supported by any documentation of the supposed debt, and included affidavits with fake or forged signatures.

The complaint states that Encore Capital Group Inc., Asset Acceptance Capital Corp., and Midland Funding LLC, as well as several officers and attorneys working for those companies, filed false and fraudulent debt collection actions in Michigan courts.

The false debt collection lawsuit states that the “Defendant Encore and subsidiaries like Midland Credit Management purchase debt portfolios consisting of old and defaulted debt.”

Encore and Midland then used multiple law firms to attempt to collect on that debt, but the class action singles out four attorneys of Encore subsidiary Asset Acceptance for submitting false or misleading court documents.

The Encore and Midland debt collection complaints state they are “verified” by the attorneys from Asset Acceptance, but the class action contends that those attorneys have never seen any documents supporting those debt actions, and they do not use the correct wording for the verification required by Michigan law.

“If any Asset attorney had read the Verification statement prior to signing the thousands of lawsuits filed across the State of Michigan with the same computer template precision from the State of Minnesota or elsewhere, they would have picked up on the error in grammar and court rule” contained in the debt collection action, according to the complaint.

The class action alleges that the affidavits used to support the debt collection actions are prepared in another state before the action is filed, and “robo signed” with a false signature that was not the notary who is supposedly verifying the signature on the affidavit.

In a debt collection action with plaintiff Saundra Ryan, the judge stated that “Plaintiff, I’ll be honest with you, the signatures look markedly different and it does suggest to me that Affiant did not, in fact, sign the affidavit,” and went on to conclude that “Counselor, your affidavit looks like it was forged, I’ve got to be real honest with you.”

The Encore and Midland false debt collection lawsuit asserts that the “vast majority of the Debt collection lawsuits Encore files go unanswered by Consumers and result in default judgments.” Therefore, most of the debt actions go unchallenged, and Encore and Midland can collect on lawsuits that were not properly verified, argues the class action.

The lawsuit states that “filing Affidavits with a fraudulent or forged notary is always a material misrepresentation to the debtor consumer and also the Court system,” and is a violation of federal and state fair debt collection practice laws.

The plaintiffs seek to represent a Class of all persons in Michigan who “were the victims of ‘Asset Affidavits’ and ‘Asset Lawsuits’ created by Defendants in violation of Federal and State law.” The class action requests restitution for all victims, as well as treble damages and punitive damages.

Another recent class action lawsuit filed in Michigan states that debt servicer Money Recovery Nationwide charged “convenience fees” on electronic credit card payments. That class action alleges that Money Recovery Nationwide falsely represented that it was authorized to charge those fees, and violated federal debt collection laws in the process.

The plaintiffs are represented by Brian P. Parker and Nicholas A. Reyna.

The Encore and Midland False Debt Collection Class Action Lawsuit is Joanne Newman and Saundra Ryan v. Encore Capital Group Inc., et al., Case No. 2:16-cv-11395, in the U.S. District Court for the Eastern District of Michigan, Southern Division.