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  4.  — Was EGS Financial Care, Inc. Sued for Allegedly Committing Unlawful Debt Collection in Violation of the FDCPA?

Was EGS Financial Care, Inc. Sued for Allegedly Committing Unlawful Debt Collection in Violation of the FDCPA?

by | Jul 14, 2021 | Firm News |

Yes.  In the United States District Court for the Eastern District of New York, a federal class action lawsuit was filed against EGS Financial Care, Inc. (“EGS Financial Care”) – which is a debt collector – for alleged violations of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq.

The Fair Debt Collection Practices Act is a federal law that regulates the actions of debt collectors.

Any debt collector that has allegedly violated a consumer’s rights under the Fair Debt Collection Practices Act (“FDCPA”), can be sued by a consumer for statutory damages of up to $1,000; actual damages including, but not limited to, harm or loss that resulted from a debt collector’s actions; as well as the consumer’s attorney’s fees and costs.

The docket number for the case is Case No. 2:18-cv-03745.

The plaintiff alleged that EGS Financial Care sent her a collection letter that did not state the date by which she could pay the alleged “Total Account Balance” in order to fully satisfy the debt.  The plaintiff alleged that because of this, the debt collection notice was misleading.

The plaintiff alleged that the debt collection notice sent by EGS Financial Care did not specifically state when the alleged debt would ever be considered fully satisfied.  This is because, allegedly, the notice implied that the creditor, Synchrony Bank, both could continue and was continuing to add interest, late charges, and/or other charges as provided in Plaintiff’s agreement and Synchrony Bank’s own collection statements.

Plaintiff alleged that there was no way for her to know if her prompt payment of the Total Account Balance would have fully satisfied the alleged debt, as the Total Account Balance could increase due to the aforementioned accrued interest, late charges, and/or other charges.

The Plaintiff alleged that EGS Financial Care’s aforementioned omission  – omitting giving a date by which if prompt payment was made the debt would be fully satisfied – made the language in the debt collection letter that was sent by EGS Financial Care to Plaintiff misleading, and therefore it made the omission and language used a violation of the Fair Debt Collection Practices Act.

In the United States District Court for the Southern District of New York, a class action lawsuit was filed against EGS Financial Care for alleged violations of the FDCPA. The docket number for this case is Case No. 1:17-cv-08157-CM.

The plaintiff alleged that EGS Financial Care sent her a collection letter in order to collect a debt amounting to $2,074.00. The plaintiff also alleged that the collection letter stated that the balance of his debt “may be periodically increased” as a result of “accrued interest or other charges.” The plaintiff alleged that the phrasing in this letter was unclear because it did not effectively indicate the amount of debt that was owed and that the least sophisticated consumer could be confused about how much money would be owed. The plaintiff also alleged that the statement was misleading and could have multiple interpretations.

Additionally, the plaintiff alleged that due to the lack of clarity in the letter, she had to guess how much money she needed to pay, how much additional money would be owed, and whether or not the defendant would stop their collection efforts if she provided the entire sum. Furthermore, the plaintiff alleged that the collection letter did not specify how the amount of debt was calculated and did not provide an interest rate or a late fee amount so she could not have the opportunity to dispute possible increases in the month to month balance. The plaintiff alleged that while she could see the changes to the total balance, she was unable to tell whether the accrual of interest and other charges were occurring and why they were occurring. The plaintiff alleged that the purpose of the lack of clarity and specifics in the collection letter was to mislead the plaintiff into paying an amount that she may not owe. The plaintiff also alleged that the collection letter did not provide an original creditor, so the plaintiff did not know what the debt originated from.

The plaintiff alleged that EGS Financial Care violated the FDCPA by using false or misleading representations in the debt collection process due to the unclear phrasing of their collection letter that could cause the least sophisticated consumer to misinterpret the meaning of the letter. The plaintiff also alleged that the defendant did not properly state the amount of debt in the letter, which is another violation of the FDCPA.

Another federal lawsuit was filed against EGS Financial Care in the United States District Court for the Eastern District of Kentucky for alleged violations of the FDCPA. The docket number for this case is Case No. 0:15-cv-00078-HRW.

In this case, the plaintiff alleged that the defendant was trying to collect an auto loan related debt from him. The plaintiff alleged that in attempts to collect the debt, the defendant called his home phone many times a day, sometimes up to seven or eight calls a day, and even called him on the weekends. The plaintiff also alleged that the defendant called from a variety of numbers, all of which were confirmed to belong to EGS Financial Care. Additionally, the plaintiff alleged that in some of these calls, the defendant made threats to report the debt to credit reporting agencies. The plaintiff alleged that the defendant had no intention to act on these threats and only made the threats in order to force the plaintiff to pay his debt.

The plaintiff alleged that in June of 2015, he told the defendant about his economic problems and asked for them to stop calling his phone but that the calls continued until August 2015. The plaintiff also alleged that the defendant called the plaintiff on his cellphone while he was at work and when the plaintiff informed the defendant to stop calling him during work hours, the defendant did not comply by the request and continued to make the calls. Additionally, the plaintiff alleged that the defendant never sent him a written confirmation of the validity of the alleged debt.

The plaintiff alleged that the defendant’s behavior of making repeated calls, many of which were made at inconvenient times, was done with the purpose of harassing or abusing the plaintiff, which is a violation of the FDCPA. The plaintiff also alleged that the defendant violated the FDCPA because they used false or misleading means during the collection process by threatening an action that it did not intend to take.

In the United States District Court for the District of New Jersey, another class action lawsuit was filed against EGS Financial Care for alleged violations of the FDCPA. The docket number for this case is Case No. 2:15-cv-05933-JMV-MF.

The plaintiff in this case allegedly incurred a debt from a hospital that was in default at the time it was contracted to the defendant for collection. The plaintiff alleged that in order to collect the debt, the defendant mailed him a collection letter using a window envelope. The plaintiff also alleged that the account number and barcode associated with his debt could be seen through the clear window on the envelope. The plaintiff alleged that because barcodes could easily be scanned using smartphone applications or other electronic devices, anyone could have accessed the plaintiff’s account and his personal information could have been exposed. The plaintiff alleged that the defendant could have prevented the barcode and account number from being seen but because they did not do so, the defendant exposed the plaintiff’s personal identifying information and medical information to the public.

The plaintiff alleged that in violation of the FDCPA, the defendant used unfair or unconscionable means to collect a debt by exposing his account number and barcode on the envelope. According to the FDCPA, the use of any language or symbol that is not the debt collector’s address on an envelope sent to a consumer is prohibited.

Another class action lawsuit was filed against EGS Financial Care in the United States District Court for the Eastern District of Wisconsin in the Milwaukee Division. The plaintiff sued the defendant for alleged violations of the FDCPA and the Wisconsin Consumer Act. The docket number for this case is Case No. 18-cv-1073.

The plaintiff alleged that on February 25, 2018, her creditor, Synchrony Bank sent her a credit card statement for a Walmart credit card. The plaintiff alleged that the letter indicated a “New Balance,” an “Amount Past Due,” a “Total Payment Due,” and a “Payment Due Date.” The plaintiff then alleged that on February 28, 2018, Synchrony Bank sent her a notice which informed her that “$59.00 is the AMOUNT NOW DUE.” The plaintiff alleged that this amount was the same “Amount Past Due” amount that was indicated in the first letter. The plaintiff then alleged that Synchrony Bank sent her a third letter on March 28, 2018 which provided her with another credit card statement. The plaintiff alleged that this statement informed her that she now had a “New Balance” of $416.91; an “Amount Past Due” of $107.00; and a “Total Minimum Payment Due” of $158.00.

The plaintiff alleged that on March 31, 2018, the defendant sent her a collection letter in order to collect the debt on her Walmart credit card from Synchrony Bank. The plaintiff alleged that the letter stated that she had a “Total Account Balance” of $416.91 and an “Amount Now Due” of $158.00. The plaintiff alleged that the phrasing of the defendant’s letter was misleading and confusing to the least sophisticated customer because the creditor had previously sent letter(s) which indicated that the “Amount Now Due” was synonymous to the “Amount Past Due”, yet the letter from the defendant stated that the “Amount Now Due” was actually the “Total Minimum Payment Due”. The plaintiff alleged that the “Amount Past Due” and the “Total Minimum Payment Due” are not the same thing because the “Total Minimum Payment Due” is the total of the “Amount Past Due” and the minimum payment.

The plaintiff alleged that EGS Financial Care does not have the right to collect parts of a balance that are “owed” and that they can only collect what is past due. Additionally, the plaintiff alleged that the defendant’s use of “Amount Now Due” is misleading because it is inconsistent with the creditor’s use of the same phrase and the least sophisticated consumer could misinterpret it and pay a higher balance than what they actually owe. The plaintiff alleged that the defendant’s actions violated the FDCPA because they used false, deceptive, or misleading representations as well as unfair or unconscionable means during the collection of the debt.

In the United States District Court for the Eastern District of New York, another class action lawsuit was filed against EGS Financial Care for alleged violations of the FDCPA. The docket number for this case is Case No. 1:19-cv-02423-RJD-SMG.

The plaintiff in this case alleged that the defendant sent him a collection letter in order to collect a balance that he allegedly owed. The plaintiff alleged that the phrasing of the letter overshadowed his right to dispute the debt, which is afforded to a consumer by the FDCPA. Additionally, the plaintiff alleged that the defendant did not inform him that if he disputed the debt within the provided thirty-day period, the defendant would have to acquire verification of the debt and send a copy to the plaintiff. The plaintiff also alleged that the collection letter did not provide a clear differentiation between disputing a debt and obtaining verification of a debt. The plaintiff alleged that the least sophisticated consumer could interpret the phrasing of the letter to mean that the notification to the debt collector is for the purpose of obtaining verification for the debt and not to dispute the debt. The plaintiff alleged that the phrasing of the letter was written with the intention of coercing the consumer to provide payment for the debt.

The plaintiff alleged that the defendant used false or deceptive representations in the collection process and did not abide by the requirements for the validation notice due to their misrepresentation of the plaintiff’s right to dispute and obtain verification of the debt, which is in violation of the FDPCA.

 

What is the Fair Debt Collection Practices Act?

The Fair Debt Collection Practices Act (“FDCPA”) is a federal statute enacted by the 95th United States Congress. The purpose of this statute is to encourage fair debt collection, to eliminate unlawful debt collection practices, and to provide legal protection for consumers against debt collectors. The types of debt covered by the FDCPA are consumer debts, including but not limited to credit card debt, student loans, auto loans, and mortgages.

The FDCPA prohibits certain behaviors during the debt collection process and pursuant to the statute, there are a number of actions that a debt collector cannot engage in when attempting to collect a debt. For example, when speaking with a consumer, a debt collector cannot threaten them with harm or with actions that they cannot take, lie to them, swear or use foul language, or pretend that they are a government agency or a law enforcement agency, amongst other things. Additionally, there are restrictions as to when a debt collector is allowed to communicate with a consumer. For example, a debt collector cannot call an individual between the hours of 9 p.m. and 8 a.m. and if they have already told them to cease communications, the debt collector has to stop calling both their personal phone and their workplace. A debt collector also cannot call a consumer during time periods that they have indicated are inconvenient for them. Furthermore, in most states, and unless a debt collector is a debt collection law firm, a debt collector is not allowed to threaten to sue a consumer; as they do not have the present right to do so. In these cases, the right to sue remains with the original or current creditor.

If a debt collector has violated a consumer’s rights under the FDCPA, the consumer can sue them for damages. The consumer could be entitled to statutory damages of up to $1,000.00, as well as actual damages including, but not limited to harm or loss that resulted from a debt collector’s actions.