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Excerpt from Asset Acceptance 2005 10-K (Emphasis Added)


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In the ordinary course of our business, we are involved in numerous legal proceedings. We regularly initiate collection lawsuits, using both our in-house attorneys and our network of third party law firms, against consumers and are occasionally countersued by them in such actions. Also, consumers occasionally initiate litigation against us, in which they allege that we have violated a federal or state law in the process of collecting on their account. It is not unusual for us to be named in a class action lawsuit relating to these allegations, with these lawsuits routinely settling for immaterial amounts. As of February 15, 2006, we are named in four class action lawsuits in which an underlying class has been certified. Additionally, as of February 15, 2006, we are named in eight class action lawsuits in which the underlying classes have not been certified. We do not believe that these ordinary course matters, individually or in the aggregate, are material to our business or financial condition. However, there can be no assurance that a class action lawsuit would not, if decided against us, have a material and adverse effect on our financial condition.

We are not a party to any material legal proceedings. However, we expect to continue to initiate collection lawsuits as a part of the ordinary course of our business (resulting occasionally in countersuits against us) and we may, from time to time, become a party to various other legal proceedings arising in the ordinary course of our business.

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WTH? What circumstances gave rise to them giving you that letter? That's weird!

The form 10-K is required annually by the SEC. It's kind of a yearly "state of the company" report.

They should have just said "we're going to continue to circumvent federal law and sue helpless consumers at every opportunity". That would be accurate, don't you think?

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10-K's are legally required by the SEC for all publically held companies. As nascar said, it is an annual report disclosed to the public to see the status of a company's business and is required to have all legal proceedings disclosed. Also 10-Q's are a required quarterly report, you can find some pretty good info there as well. Just search the SEC website for the reports. Only publically traded companies are required to file these. So if the company is privately held, you wont find any info.

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"Oh, but you told the SEC you were. Shall I contact the FBI to open a Sarbanes-Oxley investigation?"

Slightly off topic however as an officer of a Publically traded company, Sarbanes Oxley requires disclosure of all financial statements, and internal controls. It requires publically traded companies to contain an assessment, as of the end of the most recent fiscal year of the Company, of the effectiveness of the internal control structure and procedures of the issuer for financial reporting. Not necessarily to report they are a collector, JDB, etc. (in certain instances, I can see your point)

And one would need to contact the SEC for such investigation if it were deemed a civil case, otherwise if it were criminal, you are correct, one would need to contact the FBI.

Saved as a link on my desktop:

http://cpcaf.aicpa.org/Resources/Sarbanes+Oxley/Summary+of+the+Provisions+of+the+Sarbanes-Oxley+Act+of+2002.htm

In the ordinary course of our business, we are involved in numerous legal proceedings. We regularly initiate collection lawsuits, using both our in-house attorneys and our network of third party law firms, against consumers and are occasionally countersued by them in such actions. Also, consumers occasionally initiate litigation against us, in which they allege that we have violated a federal or state law in the process of collecting on their account. It is not unusual for us to be named in a class action lawsuit relating to these allegations, with these lawsuits routinely settling for immaterial amounts. As of February 15, 2006, we are named in four class action lawsuits in which an underlying class has been certified. Additionally, as of February 15, 2006, we are named in eight class action lawsuits in which the underlying classes have not been certified. We do not believe that these ordinary course matters, individually or in the aggregate, are material to our business or financial condition. However, there can be no assurance that a class action lawsuit would not, if decided against us, have a material and adverse effect on our financial condition.

We are not a party to any material legal proceedings. However, we expect to continue to initiate collection lawsuits as a part of the ordinary course of our business (resulting occasionally in countersuits against us) and we may, from time to time, become a party to various other legal proceedings arising in the ordinary course of our business.

This above quote does show that one should check the financial statements of a publically traded collector prior to legal action, see if they are involved in any material actions, it can help your case greatly.

Go here to do so:

http://www.sec.gov/edgar/searchedgar/companysearch.html

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