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Midland Funding Possible Beginning of Many Violations


QM07
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Hello:

Thanks to everyone on the forum who continually offers their support and insight to not only myself but all posters making inquiries. I have been dealing with CA and OCs for the last year and a half due to my past financial problems.

I have come across the standard sequence many times, and was just recently contacted by Midland Funding (well, technically not, as you'll learn) for the first time and they seem to be a bit creative in what they're doing. I feel that they may have possibly already committed violations right out of the gate, and will surely continue to do so. However, I'm interested to know everyone's interpretations of this situation because I've never *NOT* been contacted by the CA attempting to collect from me.

On April 7, 2009 I received a letter from Moore & Scribner Attorneys At Law stating they represent Midland Funding, LLC who has purchased by WaMu debt. I was excited to learn it was purchased, because its only $500, and Chase bought WaMu, etc during this delinquency process so chances are they don't have any docs on this. I was a bit confused at why Midland didn't contact me themselves immediately, but figured they were going to do something tricky.

I DV'd Moore & Scribner, which they received on April 25th, 2009. I have a few questions at this point:

1). Does the letter from Moore & Scribner constitute Midland Funding's first attempt to contact me/collect, or did Midland Funding require their own separate DV letter? Does More & Scribner, as a CA/Attorney, have any responsibility to report the dispute to Midland, and thus Midland to validate at this point?

* I ask this question because of the FDCPA clause stating they must contact me within 5-days of first contact.

** After debating this for some time and dealing with other previous issues, I decided to send a separate DV letter directly to Midland letting them know I received contact from Moore & Scribner, and seeking validation from Midland as well. I did this in hopes of establishing the Moore & Scribner letter as first contact from both, and also have substantial documentation requesting validation directly from Midland to protect my report.

Sure enough, Today Identity Guard reported to me that Midland Funding LLC has made a collection report on my credit. I'm now wondering if this is an FDCPA violation based on the 4/25 Moore & Scribner DV, or if I will have to give them 30-days from when they receive my direct Midland-DV before I can attack this.

It's evident that Midland used Moore & Scribner for first contact most likely to dodge DV responsibility and make a report on my credit.

I'd like to annihilate them so any help or insight is much appreciated.

Kind regards,

QM07

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Hello:

Thanks to everyone on the forum who continually offers their support and insight to not only myself but all posters making inquiries. I have been dealing with CA and OCs for the last year and a half due to my past financial problems.

I have come across the standard sequence many times, and was just recently contacted by Midland Funding (well, technically not, as you'll learn) for the first time and they seem to be a bit creative in what they're doing. I feel that they may have possibly already committed violations right out of the gate, and will surely continue to do so. However, I'm interested to know everyone's interpretations of this situation because I've never *NOT* been contacted by the CA attempting to collect from me.

On April 7, 2009 I received a letter from Moore & Scribner Attorneys At Law stating they represent Midland Funding, LLC who has purchased by WaMu debt. I was excited to learn it was purchased, because its only $500, and Chase bought WaMu, etc during this delinquency process so chances are they don't have any docs on this. I was a bit confused at why Midland didn't contact me themselves immediately, but figured they were going to do something tricky.

I DV'd Moore & Scribner, which they received on April 25th, 2009. I have a few questions at this point:

1). Does the letter from Moore & Scribner constitute Midland Funding's first attempt to contact me/collect, or did Midland Funding require their own separate DV letter? Does More & Scribner, as a CA/Attorney, have any responsibility to report the dispute to Midland, and thus Midland to validate at this point?

* I ask this question because of the FDCPA clause stating they must contact me within 5-days of first contact.

** After debating this for some time and dealing with other previous issues, I decided to send a separate DV letter directly to Midland letting them know I received contact from Moore & Scribner, and seeking validation from Midland as well. I did this in hopes of establishing the Moore & Scribner letter as first contact from both, and also have substantial documentation requesting validation directly from Midland to protect my report.

Sure enough, Today Identity Guard reported to me that Midland Funding LLC has made a collection report on my credit. I'm now wondering if this is an FDCPA violation based on the 4/25 Moore & Scribner DV, or if I will have to give them 30-days from when they receive my direct Midland-DV before I can attack this.

It's evident that Midland used Moore & Scribner for first contact most likely to dodge DV responsibility and make a report on my credit.

I'd like to annihilate them so any help or insight is much appreciated.

Kind regards,

QM07

Does wama report it as a neg still,on your credit report?
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Here's the way I see it.

Midland Funding has bought your account. As a Junk Debt Buyer, they are not really required to do anything; in a sense, as just a JDB they are not subject to the FDCPA. They hired Moore and Scribner to collect on their behalf. As a debt collector, M&S is subject to the FDCPA, (although they may claim they are exempt because they are attorneys.) As long as their letter contained the Verification Statement required by the FDCPA, they are compliant with the law. Once you DV'd M&S, they are now required to cease collection activities until they obtain verification from the creditor (Midland) and mail it to you. Your DV letter to Midland does not obligate them to send you anything. The are just the account owners at this point.

Now, I don't know if Midland's report to your credit report is a violation, but I think they need to eventually report it as "disputed", although you may have to allow a reasonable period of time for that to happen.

Good luck.

DH

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Hello DH:

I appreciate your taking the time to respond to my thread and provide your insight and opinion. I disagree with you on a few points, and welcome conversation regarding them.

The FTC opines that a collection report on a credit report constitutes collection activity. Therefore, I'm of the opinion that reporting on my credit report is an act of collection activity. This holds true, and is the basis of, the fact that a CA is in violation of the FDCPA if they report to your credit after receiving a DV. It's been upheld that this report in and of itself is an attempt to collect on a debt. Therefore, I feel that Midland's reporting to my credit (whether or not its a violation after DVing M&S is not the question) is an attempt to collect on this debt, and possibly the first attempt. Being the first attempt, it may also be considered first communication as well.

Saying that Midland is not falling under the FDCPA on this is a bit silly. Referring to Midland as the "Creditor" is a bit silly as well. Had Midland as the JDB contacted me directly via letter and I DV'd them, it is their responsibility to verify with the OC (WaMu/Chase).

I understand your perspective regarding M&S verifying with Midland, and this is the point of my post exactly. Midland is using M&S to collect on a debt they are trying to 'collect' on so that they can raise a creative question as to their obligation to verify under the FDCPA because they know they can not verify. However, over time, this will not fly. As a JDB, Midland must verify. At the very least, after making a report on my CR, I can DV them because this now constitutes Midland attempting to collect.

Also, your statement that as a JDB they are not required to do anything nor fall under the FDCPA seems off the wall to me. The definition of who falls under the FDCPA is any company whose sole business is collecting debt. That is Midland by definition, regardless of what methods or means they utilize to do so.

Let me know what you think.

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There is no doubt about that.

Midland (and its collection agents) may chose to cease collection rather than validate. They are not required to validate the debt under the FDCPA.

However, if they chose not to validate AND they chose to continue collections, like sue you or something, YOU HAVE TO PROTECT YOUR RIGHTS BY SUING OR COUNTER-SUING THEM WITH WELL PLEADED FDCPA COMPLAINTS. Not validating and continuing to collect is a violation of the FDCPA.

Now is bad or inaccurate credit reporting a collection attempt? That would be a novel approach in interpreting this part of the FDCPA. May be tough, but it is the "unsophisticated consumer" standard may allow that approach to be argued with legitimacy.

However, if accurate credit reporting is what you are after, using the FCRA makes more sense.

If anything is reporting in error to your credit report over this, and you've attempted to dispute and remove it off and its been validated, you will need to sue Midland, the collection attorney, and probably the credit reporting agency under the FCRA.

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Hi Trueq:

Thank you for taking the time to reply to my thread. When I said I felt the reporting of a trade line to the CRA was a collection attempt, I was referring to a very popular FTC Opinion Letter which stated this.

The question which arose from a CA writing to the FTC asked if a consumer requested validation within the 30-day period and the CA chose not to validate, would reporting a tradeline to the CRAs *after* receiving said validation request constitute a collection attempt, and thus an FDCPA violation.

The FTC said "Yes", this would constitute an FDCPA violation because they felt the reporting of a negative tradeline (accurate or not) is an attempt to collect a debt.

Therefore, the question I'm raising is regardless of whether Moore & Scribner's contact with me on behalf of Midland is a collection attempt, based on the FTC opinion letter that reporting a trade line is a collection attempt one or the other will serve as an attempt to collect.

I put this up for discussion because I think its an interesting topic, and based on my experience with both CAs and JDBs in the past, they typically contact you via writing first, which Midland didn't.

Kind regards,

QM07

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It is possible to use that as a basis of a "well pleaded FDCPA lawsuit".

However, letter rulings can be tough to make a case on under normal lawsuit circumstances.

But the FDCPA's "least sophisticated debtor" or "unsophisticated consumer" standard gives a plaintiff debtor suing an excellent chance with a mere FTC letter ruling.

This is all contingent on your willingness to strike with the sword by suing.

AND

Having a well pleaded FDCPA complaint that educates the judge. There are judges out there that don't know what the FDCPA is or what it does. So the complaint needs to be a massive education campaign sometimes so it doesn't get thrown out.

If you are going to make credit reporting an issue in the lawsuit, incorporate a FCRA cause of action as well.

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The FTC opines that a collection report on a credit report constitutes collection activity. Therefore, I'm of the opinion that reporting on my credit report is an act of collection activity. This holds true, and is the basis of, the fact that a CA is in violation of the FDCPA if they report to your credit after receiving a DV. It's been upheld that this report in and of itself is an attempt to collect on a debt. Therefore, I feel that Midland's reporting to my credit (whether or not its a violation after DVing M&S is not the question) is an attempt to collect on this debt, and possibly the first attempt. Being the first attempt, it may also be considered first communication as well.

Let's assume all this is true: that reporting to the credit agencies is a collection attempt, and that they did it after being notified that you had disputed the debt. The problem is, can you prove it? It seems like it would be too easy for Midland to claim that they had not yet been informed that you had disputed, thus they were entitled to report to the credit agencies. But I disagree strongly that reporting to the credit agencies is a first communication. I have always held that it's pretty clear what a first communication is: it's a phone call or letter to the debtor.

Saying that Midland is not falling under the FDCPA on this is a bit silly. Referring to Midland as the "Creditor" is a bit silly as well. Had Midland as the JDB contacted me directly via letter and I DV'd them, it is their responsibility to verify with the OC (WaMu/Chase).

I oversimplified things in my earlier statement, and created some confusion. Certainly, as a JDB, Midland is subject to the FDCPA - or to be more precise, their actions are. I just don't see what actions they have taken that fall under the FDCPA's jurisdiction - with the possible exception of reporting to the credit agencies discussed above. As for referring to Midland as a "Creditor", I believe it's pretty standard, although I may be mistaken. The current owner of the debt is called the "creditor", not to be confused with the "original creditor."

I understand your perspective regarding M&S verifying with Midland, and this is the point of my post exactly. Midland is using M&S to collect on a debt they are trying to 'collect' on so that they can raise a creative question as to their obligation to verify under the FDCPA because they know they can not verify. However, over time, this will not fly. As a JDB, Midland must verify. At the very least, after making a report on my CR, I can DV them because this now constitutes Midland attempting to collect.

Here's where we mainly disagree. I think you are really stretching things in an effort to make a case that Midland has violated the law. I understand your feelings, but wanting something doesn't make it so. I'm trying to provide a more objective opinion. Of course, you are entitled to disregard it if you wish.

I think you need to remember that a DV letter only has any meaning when it's sent in response to a dunning letter, which should carry the FDCPA Verification Statement if it's the first letter. That exchange has occurred between you and M&S, and that's fine. Midland hasn't sent a letter, and I don't see where they were required to do so. They're entitled to hire someone to collect on their behalf, and they did. They hired a law firm either to scare you a little bit, or in anticipation of filing a law suit. Regardless, no one is ever required to verify; they can choose to discontinue collection activity. And again, thinking you are entitled to DV because they have reported and that's a collection attempt is what doesn't fly. Again, a DV letter is a specific response to a dunning letter.

Also, your statement that as a JDB they are not required to do anything nor fall under the FDCPA seems off the wall to me. The definition of who falls under the FDCPA is any company whose sole business is collecting debt. That is Midland by definition, regardless of what methods or means they utilize to do so.

I'll agree, as I said above: their actions are governed by the FDCPA. But again, I don't see what actions they have take that violate the law. The reporting thing is a gray area, I think, and one you probably can't prove.

Good luck.

DH

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