MCM keeps telling they need more information in response to both of my DV's

[kreozZ]

Hi folks,

I received a letter from Midland Credit Management (MCM) telling me they had purchased my charged off credit card account (the debt is within SOL). I immediately sent a Debt Validation letter to them with CMRRR, and received the reply saying "they needed more information to investigate the dispute". They were asking me to provide the reason for my dispute (!) and supporting documentation. The notice also included a printout of the last account statement from OC (BoA), which I believe they just had got at the time of purchasing the debt.

So the question number one is:

(1) Even though their corporate headquarters is located in CA, and they are bound by California Civil Code, which says that they have to cease any collection activity upon receipt of the documents proving the reason for the dispute (http: //law.justia.com/california/codes/2009/civ/1788.10-1788.18.html - section 1788.18), does it actually mean they can just blindly ignore FDCPA provisions? FDCPA does not state there should be any specific reason for my dispute with Collection Agency. I thought the burden of validating the debt and forwarding all the documentation is placed on them rather than on me.

Upon receipt of their notice, I have made a research over the internet and found out that the notice I received is a typical one they send in reply to DV letter. But, since they formally respoded to my validation request (even although the response itself was not satisfactory), I decided to relay another one and give them additional 30 days. So I spent a weekend and made a nice DV letter # 2 informing them that:

- I have no additional info to provide them;

- They failed to properly validate the debt;

- They had to do it in 30 days or cease collection activities;

- They are not licensed in the state where I reside MA, while the state in itself requires license to carry on the business.

I explained everything in detailes and quoted all the case laws and whatnots.

Almost two weeks have passed after I sent my letter with CMRRR... Guess what? Yesterday I received another letter, this time without any enclosures, instructing me to send them additional documentation! That was the very same notice as the first one... Looks like they have not even read my DV # 2.

________________________________________________________________

First of all, I need to know if I am supposed to answer them or just to wait until 30 days from the date of the receipt of DV # 2 are over. Inasmuch as I told them in my DV # 2 that they had to provide specific documents to prove the validity of the debt (such as all account statements, credit card application with my signature, proof they have actually purchased the debt ect.) and they failed to, it appears to me I do not have to answer them at all but just wait.

So my question number two is:

(2) Do you think I am right with respect to I don't have to respond?

What I am also going to ask you guys is whether I rendered the course of further actions properly. I am going to do the following:

1. Wait for 30 days;

2. As MCM only reports collections account to Experian, I will dispute with them;

3. When it gets back verified, that will constitute continuation of collection activity without proper validation contrary to FDCPA;

4. I will need to file complaints to BBB, ACA, AG in CA, AG in MA, FTC;

5. Will I need to apprise MCM that I filed complaints?

6. Wait for the results;

7. If it does not work out, then send MCM intent to sue and consequently file a suit.

Any help and/or experience will be much appreciated!

Thank you in advance,

Need-to-get-the-out-of-the-bad-credit-history guy.

[BV80]

How did they validate the debt? What did they provide?

[Andyt293]

I say skip everything and proceed to a suit in small claims court on Monday. I had a similar situation with a CA (can't say who ), who played games with me, asking for additional information.

My contention was, the CA is attempting to collect a debt, why do I have to provide information to them?

In any case, I sent an intent to sue letter, it was ignored, I filed a complaint in small claims court and today I received a settlement check for $800 plus my court costs.

[BV80]

kreozZ,

You stated that the validation response was not satisfactory. That's why I asked what they provided.

[nascar]

This is part of the business model of a debt buyer. Since it benefits them not to be a "collection agency," they attempt not to do those things which, by their actions, makes it clear that they are a collection agency. One of those things is responding properly to a validation request.

So, in practice, your DV, sent pursuant to the FDCPA, is treated as if it were a 623 request under the FCRA. The excuse being, "we're not a debt collector, so we're not subject to the FDCPA." So, they refuse to respond as a debt collector and instead, respond as a creditor receiving a dispute under the FCRA. Midland, Portfolio and others have been doing this for years. And despite that argument being beaten from one end of the planet to another, they still use it -- all the time. However, it will be interesting to see how that plays out under the recent ruling which narrowed the application of the BFE defense.

When they pull that kind of nonsense (and I mean rather than provide you with the name of the original creditor and the amount the original creditor is claiming is due, and instead respond by telling you they don't have enough information to respond), I treat it as a non-response and proceed accordingly. The law doesn't require me to send a follow up to my DV, nor is it my duty to explain the law to these scum. If they choose not to follow the law, then I'm not going to hold their hand throught the process.

[kreozZ]

Thank you for the replies.

BV80,

They just provided the last account statement, as well as a sheet describing some of the terms of the original contract. However, there was no signature on that sheet, nor was it filled by anyone. So basically, that was just a mere internet printout. Also, the account statement did not describe how the balance was calculated from the very beginning, including any fees added. And of course, there was no contract between CA and OC submitted. Thus, I deed such a "validation" bogus.

nascar,

You are right! That is why I guess they mentioned FCRA rather than FDCPA in their reply (something like "in order to investigate your dispute under provisions of FCRA, we will need to identify the reason of the dispute" etc.). Actually, I deem such a strategy stupid, as there is a note at the bottom of the page saying "this is communication from debt collector". They are clearly not original creditor, and if they pretend to be someone but debt collector, why on Earth am I supposed to pay them?

Long story short, what would you do if you were in my shoes? Do you think it is worth proceeding with lawsuit? I have never actually dealt with suits before, and preparing for it would take plenty of time.. All I need to do is to get rid of that guys. Could you advise me as to what to do further? As far as I understand, it is pointless to send them another letter telling they "failed to validate and must delete the tradeline".

Thanks again!

[BV80]

BV80,

They just provided the last account statement, as well as a sheet describing some of the terms of the original contract. However, there was no signature on that sheet, nor was it filled by anyone. So basically, that was just a mere internet printout. Also, the account statement did not describe how the balance was calculated from the very beginning, including any fees added. And of course, there was no contract between CA and OC submitted. Thus, I deed such a "validation" bogus.

According to the FDCPA, they validated. The FDCPA only requires they provide the name of the OC, the amount, and the 30 day dispute speech.

If that statement has the name of the OC and the balance, they did their job.

They do not have to provide a signature, application, calculation, etc. We may not like that, but the FDCPA does not require those things.

Your credit report could be a different story, however. That's where I would demand they prove they own the debt and have a right to report.

If the balance they're reporting on your CR is different from the balance the OC is reporting, demand Midland provide a breakdown of fees and interest. Dispute the balance with Experian. If Midland verifies with Experian and refuses to give you a breakdown, you could have them on the FDCPA and FCRA.

Edited December 12, 2010 by BV80

[kreozZ]

Let me disagree. FDCPA states:

"If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, OR the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, OR the name and address of the original creditor..."

They are required to address either request. I did not ask them for just name and address, so they must provide verification. There are numerous case laws that help to understand what CA is required to provide as a validation, despite FDCPA does not specifie that.

Furhter, would you ever pay a guy who states you owe him money, but cannot provide anything as a proof? This is nonsense.

Edited December 13, 2010 by kreozZ

[BV80]

I'm not trying to be difficult. Sending you a collection letter and reporting on your CR are 2 different things. If they only sent a collection letter and nothing else, the FDCPA specifically states what they must provide.

I also told you that I believe they must show MORE than that if they are reporting on your credit report. I did not say the name of the creditor and amount of the debt were enough in that case. If they are doing something that can harm your credit, they must prove ownership and the amount they are claiming.

[kreozZ]

I was not trying to be difficult either What I was trying to do is to check my logic.

Yes, they do report collections account, so in this case, they are required to show more, right? Could you tell me if there is a law that states so (FCRA probably)? I just want to be prepared in case I need to sue them. I did not know that reporting something derogatory and merely trying to collect are different things..

Thank you!

[Flyingifr]

Let me disagree. FDCPA states:

"If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, OR the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, OR the name and address of the original creditor..."

They are required to address either request. I did not ask them for just name and address, so they must provide verification. There are numerous case laws that help to understand what CA is required to provide as a validation, despite FDCPA does not specifie that.

Furhter, would you ever pay a guy who states you owe him money, but cannot provide anything as a proof? This is nonsense.

You may disagree but the US District Court for the District of Maryland disagrees with you. In the Chaudhry (Chaudhry v. Gallerizzo) case the Plaintiff (Chaudhry, the consumer) tried to dictate what Validation was. The Court slapped her down on all issues applying the same definition to VOD as the Supreme Court applied to Obscenity (we can't define it but we will know it when we see it).

If you want a laundry list of useless things to demand in a VOD letter do a search for the "Gliha Letter". John Gliha is a master of bad advice.

[BV80]

Yes, they do report collections account, so in this case, they are required to show more, right? Could you tell me if there is a law that states so (FCRA probably)?

The FCRA states that information must be accurate. It also states that the info they report must match up with the OCs information such as the same default date. The FCRA does not list requirements that are necessary to prove whether or not a JDB has the right to report.

Making a JDB prove the right to report is up to the consumer. If they can't prove they own the debt, it's up to you to fight to get their TL off your CR.

I did not know that reporting something derogatory and merely trying to collect are different things..

Merely trying to collect doesn't hurt your CR. Certain collection tactics are illegal, but they don't damage your credit rating.

Edited December 13, 2010 by BV80