The New York Attorney General and Federal Trade Commission recently announced they had filed two joint federal court lawsuits against debt collectors in the Western District of New York. The Attorney General and FTC are seeking injunctive relief and damages for violations of the Fair Debt Collection Practices Act (FDCPA), Federal Trade Commission Act, and New York General Business Law arising from the alleged collection of $45 million in consumer debt. The lawsuits— which have already resulted in temporary restraining orders—are the latest reminder that debt collectors that fail to strictly follow state and federal debt collection law are prime targets for an enforcement action in New York.

Vantage Point Services

In the first lawsuit, the Attorney General and FTC sued Vantage Point Services, LLC, its corporate affiliates, and officers for allegedly falsely threatening to arrest consumers if the underlying debt was “not paid within hours or minutes” of the call. The complaint also charged that the defendants’ callers falsely misrepresented their identities as law enforcement officers, attorneys, and government agents. In addition, the defendants allegedly used fictitious business names and provided inaccurate contact information to consumers.

The government also claimed that the defendants would inform the consumer’s family members and friends that the consumer had committed a crime and a warrant had been issued for his or her arrest. Finally, the defendants allegedly violated the FDCPA validation procedures by failing to provide basic information about the debt within five days of the initial communication.

4 Star Resolution, LLC

In the other lawsuit, the Attorney General and FTC alleged that 4 Star Resolution, LLC, its corporate affiliates, and officers consistently misrepresented to consumers that they “committed bank and checking fraud” by neglecting to pay their debts on time. Among other things, the defendants’ collectors allegedly misrepresented themselves as law enforcement officers and threatened to arrest consumers and garnish their wages if the debts were not immediately repaid. The government also claimed that the collectors unlawfully disclosed information about the underlying debt and disparaged consumers to third parties, including family members, co-workers, and friends. Finally, the government alleged that the defendants failed to disclose any information about the underlying debt to consumers upon request, and failed to provide the validation information required by the FDCPA.

Enforcement activity against debt collectors and debt buyers can only be expected to intensify as the vast majority of the New York Department of Financial Services’ (DFS) debt collection regulations took effect on March 1, 2015. As we explained in our recent alert, it is imperative that those in the industry be prepared to comply with these regulations on Day One; the Attorney General and DFS have shown no indication they will tolerate anything less.

Attorneys in Ballard Spahr’s Consumer Financial Services Group regularly advise clients on compliance with the FDCPA and state debt collection laws and defend clients in FDCPA lawsuits and enforcement matters. They also prepare clients for their first Consumer Financial Protection Bureau examinations. The Group is nationally recognized for its guidance in structuring and documenting new consumer financial services products, its experience with the full range of federal and state consumer credit laws, and its skill in litigation defense and avoidance. In addition, the Group regularly defends debt collectors and debt buyers in individual and class action litigation brought in New York state and federal courts, as well as enforcement actions brought by the DFS, New York Attorney General, and New York City Department of Consumer Affairs.

For more information, please contact CFS Practice Leader Alan S. Kaplinsky at 215.864.8544 or, John L. Culhane, Jr., at 215.864.8535 or, or Heather S. Klein at 215.864.8732 or

Copyright © 2015 by Ballard Spahr LLP.
(No claim to original U.S. government material.)

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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.

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