The Consumer Financial Protection Bureau is continuing its pursuit of third-party collection law firms it believes misrepresent to consumers the level of attorney involvement in their collection practices.
On April 17, the CFPB filed suit in the Northern District of Ohio against Weltman, Weinberg & Reis Co., L.P.A., for allegedly misrepresenting in millions of collections letters the firm's level of attorney involvement in its collection cases. In the complaint, the CFPB alleges the firm repeatedly created the false impression of meaningful attorney review on collection calls and letters when no such review actually occurred.
The case is Consumer Financial Protection Bureau v. Weltman, Weinberg & Reis Co., L.P.A. (Case No. 1:17-cv-00817, N.D. Ohio). The complaint can be found here.
In a press release, CFPB Director Richard Cordray stated that "[d]ebt collectors who misrepresent that a lawyer was involved in reviewing a consumer's account are implying a level of authority and professional judgment that is just not true." He further noted that "Weltman, Weinberg & Reis masked millions of debt collection letters and phone calls with the professional standards associated with attorneys when attorneys were, in fact, not involved. Such illegal behavior will not be allowed in the debt collection market."
The suit alleges violations of the Fair Debt Collection Practices Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act. Specifically, the CFPB alleges that since at least July 2011, Weltman misrepresented the level of attorney involvement in violation of Section(s) 1692(e)(3) and -(10) of the FDCPA by sending collection letters on formal law firm letterhead with "Attorneys at Law" in the banner and the law firm's name in the signature line. The letters also allegedly included coupons for payments made directly to the law firm, and some referred to possible "legal action" against consumers who did not make payments. The CFPB also alleges that despite implying meaningful attorney involvement throughout these letters, no attorney had ever reviewed the account or made any legal evaluation in the vast majority of cases.
The CFPB further alleges that Weltman, Weinberg & Reis misrepresented attorney involvement in collection calls. According to the complaint, the firm's debt collectors regularly told consumers during such calls that they were calling from a law firm, specifically the "largest collection law firm in the United States," or that the debt had been placed with "the collections branch of our law firm." In the CFPB's view, this wrongfully implied attorney involvement where no such meaningful attorney review had taken place.
The suit seeks injunctive relief, penalties, and compensation for consumers.
As we have previously reported here and here, the CFPB for some time has been actively investigating law firms for lack of meaningful case oversight by attorneys. For example, in January of 2017 the CFPB alleged that the Work & Lentz law firm sent out collection letters without having an attorney review the consumers' files and make any professional judgment about the account, thereby failing to meet the FDCPA's standard of "meaningful attorney involvement." The recent Weltman complaint is part of this pattern, and demonstrates the CFPB's continuing efforts to enforce meaningful attorney involvement requirements in the debt collection field.
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