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Attack of the OC, round 2...turning the tables....


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Some of you have been following my ongoing mess with a local OC....well, now it's my turn.

 

The OC sued me for a car loan when we were not in default.  We had been disputing their credit reporting for basically all of 2013.  So now, to make a long story short, the car was totaled and the lender was paid in full.  Then the lender dismissed their claim against us, "without prejudice and at plaintiff's cost".  That brings us to this thread. 

 

I had spoken to an attorney previously regarding these clowns, and I will have representation for this case.  But I would also like any thoughts or opinions from the folks in here as well.  We decided to file suit against the OC after they had sued me, but the attorney felt it best to wait until the lender's case was dismissed.  Due to what I had filed in the case, the lender would have been nuts not to dismiss.  I have a lot of evidence and for some reason the lender failed twice to even produce the promissory note for the loan!

 

So here's the basis for the complaint....Defendants are the lender and an individual we'll call Mr. Smith.  Smith is not an employee of the lender, but they did contract with him to perform a voluntary repo.  For those who do not know, in my state, repossession agents are rather strictly licensed and governed.  Smith is not licensed, and if he had stuck to "Hi, I'm Smith, and I am calling to ask if you would be willing to return the car to lender?", he would have been just fine.  We are pursuing Smith for:

 

1--FDCPA violation--namely, deceptive practices

--posing as law enforcement

--posing as state government employee

--claiming to have a court order to seize my car when he does not

--plotting to forcefully take possession of my car(action which he cannot legally take).

 

--FDCPA--misrepresentation of amount and character of debt

 

--FDCPA--abusive phone calls, cursing, etc

 

There will be criminal implications as well for Smith....impersonating a cop and a government official, and also using the name of a high-ranking state government official to commit his fraud.  He's already facing felony aggravated assault charges right now for trying to take someone else's car and getting into a physical fight with the person.

 

We are going after lender for:

 

1--FCRA violations...a lot of them.  I disputed their entry on my credit report this past summer.  They verified it as accurate, changing nothing even though they admit on the phone that I was current.  (I have that conversation on tape, they do not know).  They blamed the credit bureau for the mistakes, claiming that the credit bureau is reporting 30-60 days behind.  Basically, they claim that what they report for August really was reported for June...you get the idea.  I have the numbers documented pretty good to show that this is not the case either, and on the phone call they admit to me being current even though they reported me as as much as 120 days late at times.

 

Their credit reporting caused me to be denied credit with a bank that I have had three auto loans with over the last several years. 

 

2--Fraud upon the court....they dismissed their claim against me "at plaintiff's cost"....but they had already stolen their court costs from me.  This is where I could really use some thoughts from anyone who knows....When the car was totaled, the lender added their court costs to the loan balance--without the court's order allowing it--and gave the wrong balance to my insurance.  My insurance paid them the higher amount.  They misrepresented the amount of the debt to the insurance company.  Then, when they got the payoff check, they took over $1000.00 of that money and applied it to attorney's fees, again without the court's order granting them that money.  Since they paid that money to their lawyer, they "waived" that much of the loan balance so that they could close my account out and consider it paid in full and closed. 

 

The problem there is this--the IRS by law requires them to now issue a 1099C on that amount that they "waived".  That means that I will be hit with a tax penalty of probably 200-300 bucks because any amount over $600 that is forgiven is considered to be income by the IRS.  So they were paid in full, in good faith, and because they screwed with the money, I am about to get penalized.  I called this fraud upon the court because they represented one thing to the court, and another thing to me separately. 

 

There may be an issue also with fraudulently issuing a 1099C....not sure what the IRS will say about that, I hope to find out tomorrow.  Does anyone here know? 

 

The attorney I spoke with is going to structure this so that we include the lender in the claims of wrongdoing against Smith--he is going to assert that because of how Smith tried to take the car, that the lender must know about his tactics....that they used him knowing what he does is illegal.  Smith tried to get me to meet him at the lender's office to "sign a promissory note to catch up on any late payments"....from other complaints the state has received about him, I know now that his plan was to block me in and refuse to let me leave in the car.  If we can show that the lender still uses this guy, or has used him while knowing what he has been doing, then they could very well lose their lender's license altogether.  My dealings with him are rather tame compared to what he has done to others....

 

OK, so now, you've read the book...does anyone have any thoughts or similar experiences? 

 

 

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As you know, I have NO experience with this and almost NO knowledge of what to do in ANY debt situation, but I just wanted to say I hope you smear them all across a wall!!!!!  Your story is one I've read with my mouth hanging open in disbelief -- I cannot BELIEVE something like that could actually happen to a customer who is current on all their payments!

 

I wish I could help you, but all I can do is cheer you on -- GO GET 'EM!!!

And good luck! :-)

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Here is my take:

 

As an independent contractor of the lender the lender is NOT responsible for Smith's conduct.  If Smith were an employee they would be responsible under the legal theory of respondiat superior "let the master answer":  the employer is responsible for the conduct of their employees in the course of their duties.  Because Smith is an independent contractor they are responsible for their own torts and crimes.

 

I don't know of ANY case law that considers a repossession agent a collection agent.  I don't see the FCDPA applying to a repossessor.  Smith also isn't misrepresenting the amount of the debt the repossessor goes by what the lender tells them and nothing more.  If the FCDPA does not apply to a repossession agent as I suspect then any harassing behavior over the phone is at best rude and at worst a TCPA violation.

 

You as an individual nor your attorney can press criminal charges against him for the impersonations of law enforcement or government officials.  All you can do is make the complaint to law enforcement or the DA and hope they pursue it.

 

The best you might be able to do against Smith since he never actually repossessed the vehicle is a complaint to the regulatory agency that licenses repo agents that he is practicing in violation of state law and hope they pursue it.

 

I think you have a better shot against the lender for their FCRA actions.   As far as being denied credit you will have to demonstrate to the court that their entry is the ONLY reason you were denied credit and what financial damages you suffered as a result.  

 

You might want to interview another lawyer or two.  I think this one is REALLY wrong on the lender being responsible for Smith's actions.  If he is a contractor you are going to have to go after him separately.  I will give you the example we had in my law class on this:  The Local Buy and Bag grocery store contracts Tony's Snow Plow Co to plow their parking lot from November until March.  The state requires all plow companies to be bonded and licensed and not use drivers under 21.  Tony hires his 17 year old nephew and because last winter had 13 days of snow let his license and bond lapse.  While plowing Buy and Bag's parking lot the nephew hits and totals a customer's car.  Can the customer sue the store?  NO.  Tony and the nephew are responsible for their own torts and crimes.  As an independent contractor the store is not liable for their actions.

 

FYI:  I aced that section of my classes with a 97 average.

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As an independent contractor of the lender the lender is NOT responsible for Smith's conduct.  If Smith were an employee they would be responsible under the legal theory of respondiat superior "let the master answer":  the employer is responsible for the conduct of their employees in the course of their duties.  Because Smith is an independent contractor they are responsible for their own torts and crimes.

 

For most things, yes.  However, there are two points that apply to this situation that change the game.  First, they knew he was not licensed, and supposedly they only contracted with him to contact me and ask if I would be willing to return the car.  But if they really did know that he was acting illegally, and they put him in the position to do it again, then they definitely can share the liability.  Second, they could actually lose their lending license in my state over this.  Repo regulating is serious business down here, and the industry does not allow any kind of nonsense to go on.  Repo agents are on a very short leash here--you mess up, your license gets yanked.  They do not play around.  Some of this will possibly fall more on the criminal side of things too, I know, but at this point, it's all leverage. 

 

I don't know of ANY case law that considers a repossession agent a collection agent.  I don't see the FCDPA applying to a repossessor.  Smith also isn't misrepresenting the amount of the debt the repossessor goes by what the lender tells them and nothing more.  If the FCDPA does not apply to a repossession agent as I suspect then any harassing behavior over the phone is at best rude and at worst a TCPA violation.

 

Oh, there's most definitely precedent for this.  This guy talked to me about making payments--he tried to get me to meet with him to sign a promissory note.  he claimed that he had the authority to walk into a lender's office and go through all of their customers' private files at will, that he would personally determine if  I was late on payments or not...and then he told me that he had the authority to force the lender to accept a 60-day promissory note, which would allow me to catch up on any payments that I might be behind without losing my car.  In other words, he went from "voluntary repo" to "debt collector" in no time. 

 

Some examples:

 

http://www.repotimes.com/main/repossession-companies-covered-fdcpa/

 

There's one section of the FDCPA that specifically applies to repossession agents, even if they do not perform any debt collection work outside of repos.  1692f(6) specifically focuses on anyone who enforces security interests....thats what repossession is.  Some case law--

 

Walker v. Gallegos, 2002

Ghartey v. Chrysler Credit Corporation, 1992

Foster v. Ford Motor Credit, 1990

Ledisco Financial Services v. Viracola, 1976

 

In my case specifically, the "repo man" threatened to take action he could not legally take--as in, he claimed to have the authority of a state law enforcement officer and a state government official, in that he threatened to simply show up and take my car out of my yard.  As he is not licensed to perform repo work in my state, he cannot legally do any such thing--it would be known as grand theft auto.  But then, he also acts as a debt collector--trying to secure payment for the lender that hired him.  This, combined with the fact that he is definitely a third party, makes him liable under the FDCPA.  That's my understanding.

 

 

You as an individual nor your attorney can press criminal charges against him for the impersonations of law enforcement or government officials.  All you can do is make the complaint to law enforcement or the DA and hope they pursue it.

 

No, we know that, and never claimed that we could.  I did not say that we were pursuing him in this case for criminal charges.  I simply said that there were criminal implications as well.  The authorities have been contacted about this guy.

 

The best you might be able to do against Smith since he never actually repossessed the vehicle is a complaint to the regulatory agency that licenses repo agents that he is practicing in violation of state law and hope they pursue it.

 

I do not agree on this one.  The trick would be enforcing any judgment that we do get, though.  He does not need to complete the act to violate that section of the FDCPA.   The statute says that "taking or threatening to take any action" that cannot legally be taken constitutes a violation. 

 

I think you have a better shot against the lender for their FCRA actions.   As far as being denied credit you will have to demonstrate to the court that their entry is the ONLY reason you were denied credit and what financial damages you suffered as a result.

 

I do agree with you on this, that this will be our best shot overall.  The lender reported false info for every month in the last year plus...and when I disputed, they verified it all as correct.  But get this--at the end of November, they marked my account as paid and closed, with a zero balance owed.  But when they did this, they went back and changed several months....some months were previously marked as 30 days late, they turned them to 60...a couple months were marked as late and now are marked as current...and so on.  They VERIFIED the entry in July/August, but then went back in NOVEMBER and changed several of the months that they claimed were accurate before.  And the worst part is that most of the changes are still wrong. 

 

As for being able to prove that they are the only reason...I have that covered.  Nothing else on my credit has changed over the last several years, and during the time we have had this car loan, we have had two different loans with the bank that now denies us credit.  We were never late with them, had no issues with them until this past summer when they denied us.  The reason they gave was specifically that we had very recent serious delinquency showing.  I have a mortgage and a paid-off student loan showing on my credit report, as well as previous auto loans that are all paid and closed.  This one account has been the only negative change on there.

 

You might want to interview another lawyer or two.  I think this one is REALLY wrong on the lender being responsible for Smith's actions.  If he is a contractor you are going to have to go after him separately.  I will give you the example we had in my law class on this:  The Local Buy and Bag grocery store contracts Tony's Snow Plow Co to plow their parking lot from November until March.  The state requires all plow companies to be bonded and licensed and not use drivers under 21.  Tony hires his 17 year old nephew and because last winter had 13 days of snow let his license and bond lapse.  While plowing Buy and Bag's parking lot the nephew hits and totals a customer's car.  Can the customer sue the store?  NO.  Tony and the nephew are responsible for their own torts and crimes.  As an independent contractor the store is not liable for their actions.

 

I really do appreciate your input on this, I hope you don't think otherwise.

 

But the situation you described here is quite different than what I am facing.  The store in your scenario was not made aware of the violations of the contractor.  In my case, I have it in writing that the lender was made aware.  Also, it is a condition of their licensing as a lender that they do not use someone who is unlicensed to perform work that requires a license.  They are strictly bound.  So, I can show that they knew, and that they still choose to use him anyways, despite lying to the state and claiming that they no longer contract with him.  In your scenario, Tony did not make the store aware of his decision to go outside his requirements on his own license.  The store did not know.  My lender did, and they admitted as much in a letter that they wrote to one of the state agencies that's been investigating them over this mess.  My state's OFI has pulled licenses before from businesses who conduct themselves in this manner. 

 

The way I am looking at this, if you are aware that someone will break the law with me, and you contract with them anyways, then you share the liability for putting me in the position to deal with that person in that manner.  The attorney I am talking with has told me that the lender will object and try to separate themselves from the individual.  We need to show that they have continued to call this guy and use him---that might be enough to sink them with him.  Either way, those are the smaller issues, anyways.  The FCRA claims are definitely the bigger issue.  But I am putting everything in that I can find.  If nothing else, it will create more leverage.  They will squirm and try to distance themselves from Smith, but the truth is that they hired Smith knowing he was not legal, and knowing his illegal tactics.  They knowingly agreed to his use of illegal methods for their financial benefit.

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