Sunday, August 26, 2012

SoCal Law Firm Develops Seemingly Out-Of-Control Rep In Effort To Collect Debts; Stands Out "As Among The Worst Of The Worst" Says One Consumer Lawyer

In El Segundo, California, the Los Angeles Times reports:

  • [B]rachfeld Law Group in El Segundo, one of the nation's largest debt collection law firms, has been contending with allegations that it failed to investigate the facts adequately when it pursued some debts. A spokesman said the firm checks to ensure accuracy. In one case, though, Brachfeld allegedly helped pursue the wrong person for a debt he never owed.

    Several years ago, debt collectors began pursuing state Sen. Lou Correa (D-Santa Ana) for an unpaid Sears bill they said he owed. He told them they had the wrong man, but the debt collectors never wavered.

    "These folks are very aggressive," Correa said. "They'll call back repeatedly and say, 'Tell us some personal information so we can tell it's not you.' When all of a sudden is the burden of proof on me?"

    Last year, Correa discovered his Senate paycheck was being garnisheed because of a $4,329 lien for the Sears debt. Brachfeld had obtained a default judgment in court, even though, Correa said, the lawsuit was never served on him and he knew nothing of the claim or the court hearing.

    He later learned that the debt belonged to a Luis Correa from Santa Ana. The man had a different Social Security number, different address, even different first name — the senator is legally Jose Luis Correa.

    "I always pay my bills on time. Then to have somebody garnish my wages, I thought was pretty astounding," the lawmaker said. He later resolved the problem and stopped the wage garnishment.

    Now Correa is supporting a bill by state Sen. Mark Leno (D-San Francisco) to require debt collectors to document that they are pursuing the right person for the correct amount of money. The bill passed the Senate and is pending in the Assembly.
  • The Brachfeld law practice files several thousand debt-collection lawsuits a month. Consumer lawyers said the firm often files suits with little documentation.

    "They stand out to me as among the worst of the worst," said Aidan Butler, a Los Angeles consumer attorney.

    In 2009, Butler won a $12,000 judgment from Brachfeld in Los Angeles County Superior Court for a consumer who had been sued by the firm to collect a $16,000 Capital One debt.

    Butler had alleged that Brachfeld violated debt collection laws by, among other actions, making harassing phone calls and failing to validate the debt. Butler said he has defended about a dozen clients against suits filed by Brachfeld and each time the suit was dismissed.

    In Alameda County, two consumers filed a class-action suit in 2010 against the Brachfeld firm and Encore [Capital Group, Inc.] subsidiaries, accusing them of illegally sending repayment letters and pursuing collection lawsuits without conducting reasonable investigations of the debt, with little involvement by lawyers and with the use of false affidavits. The suit is pending.
For the story, see Aggressive debt collection tactics are drawing federal scrutiny (Federal regulators and state lawmakers are taking action against aggressive tactics by debt collectors that have been aided by outdated laws and lax oversight).

No comments: