beachie12

Being sued by Midland Funding in Minnesota, help needed

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@WhoCares1000

@stick&rudder

I think the only way it would be a violation is if a consumer could prove the plaintiff never intended to file a complaint.  That might require examining  MN cases that were filed.  In those cases, did consumers defend themselves?  Or were all the filed cases default judgments and settlements?

I don't think one could file a claim before the one year expiration of the MN filing rule simply because the rule gives the plaintiff a year.  

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So the question is, when does the clock start for FDCPA claim. When the suit is filed or when it is abandoned (and thus the damage is known to debtor)? Like I said, I really do not know if that is possible so I would defer to the more knowledgeable experts on that one. It would probably be a tenuous claim however because you would have to prove that the plaintiff had no intention of taking the case to trial and that would be hard to do (similar to proving discrimination in an employment situation where nothing is outward about it).

Besides, the dismissal after a year is w/o prejudice. If the debt is still not SOL and the person files a claim in the courts for real, there is nothing to stop them from doing a counterclaim as they JDB got what they wanted (the debtor to pay the court fees).

Still better than the old way where the case could hang around for years before the plaintiff got around to doing a dismissal.

In any case, the OP would have a better chance on the FDCPA claim in regards to SOL and misrepresenting the debt (payment when one was not made). Since you get only one bite at the apple anyways so make it a good one.

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@WhoCares1000

I believe it would begin after the expiration of the 1-year requirement in the MN rule.   Only when that 1 year passes can you be sure that they were not going to file. 

But, again, I think you'd still have to show a pattern of not filing in order to satisfy that they never intended to file.

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1 hour ago, WhoCares1000 said:

So the question is, when does the clock start for FDCPA claim. When the suit is filed or when it is abandoned (and thus the damage is known to debtor)? Like I said, I really do not know if that is possible so I would defer to the more knowledgeable experts on that one. It would probably be a tenuous claim however because you would have to prove that the plaintiff had no intention of taking the case to trial and that would be hard to do (similar to proving discrimination in an employment situation where nothing is outward about it).

Besides, the dismissal after a year is w/o prejudice. If the debt is still not SOL and the person files a claim in the courts for real, there is nothing to stop them from doing a counterclaim as they JDB got what they wanted (the debtor to pay the court fees).

Still better than the old way where the case could hang around for years before the plaintiff got around to doing a dismissal.

In any case, the OP would have a better chance on the FDCPA claim in regards to SOL and misrepresenting the debt (payment when one was not made). Since you get only one bite at the apple anyways so make it a good one.

Contrary to above quote, according to Rule 5.04 case is dismissed with prejudice  if plaintiff fails to file after 1 year:

https://www.revisor.mn.gov/court_rules/rule.php?type=cp&id=5

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My reading of MN procedure is that once defendant is served with summons and complaint the lawsuit is commenced.

To avoid a default judgment defendant must respond via answer or motion within 20 days:

https://www.revisor.mn.gov/court_rules/rule.php?name=cp-12#12.01

Neither party seems to have to file with the court, but both are free to do so at any time. And if plaintiff fails to file within 1 year of commencing lawsuit, case is by law dismissed with prejudice.

What a strange system.

Obviously, to obtain a hearing, one must file with the court.

 

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Well this sucks. I called the branch of the bank that would have record of that $100 payment and they said the only way I can access the old statements is to come in person with id. I said I was out of state, she said doesn't matter, then I said this is a legal issue and I can't imagine their lawyer having to fly down to Florida in order to obtain those records in person. I was put on hold for several minutes then she came back and said unless I come in  there's no way to obtain them. Then she said I might try the 800 number in case they have another way, so I called and I get a message saying their system is down and to call back in 1 to 2 hours, which is the same message I heard when I originally tried the 800 number this morning, several hours before I called the branch. 

Not sure if it's worth sending the amended answer now, as even if I am able to jump through the bank's hoops to get my statements, I won't get them before the deadline for sending the answer to know if I even have a valid argument with SOL (Midland has to receive my amended answer by Wed in order for me not to need their/the court's permission to use the amended answer,  was planning to send it to them Monday overnight).

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Plaintiff will almost certainly get a judgment unless you stop playing pure defense.

I would serve plaintiff with amended answer with counterclaim and affirmative defenses.

See if you have an FDCPA counterclaim not related to SOL issue.

Assert SOL as affirmative defense with your amended answer - else it may be waived. It is ok if subsequently an affirmative defense turns out not to be valid.

A plaintiff can always claim a later payment within the SOL. They could say you made a payment yesterday. But the burden is on them to prove it, not on you to prove the negative that you didn't.

In fact, even you got all your  records from that bank, and they did not reflect the payment alleged by plaintiff, so what? Remember the maxim: Absence of evidence is not evidence of absence. The payment could have been through another bank, or via money order, etc. The plaintiff has to prove you made the payment.

The bottom line here is that you have almost no chance of avoiding a judgment by playing pure defense with the original answer only.

 

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I honestly would send the amended answer.  Remember this, they claimed in their complaint to you that the payment was made in 2010.  That means THEY have the burden of proof to prove it when you challenge it.  You lose nothing by challenging it now, and stand to gain.  Sending it now will not mean  you have to have that proof in hand right now, but  it will put them on notice that you will not take their false claim lying down.   And chances are really good that it IS a false claim, debt collectors do this a lot. 

Wheels up,

Stick

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OK Thanks @Happybluesky and @stick&rudder. So basically, I'm not proving that I don't have the debt, they are having to prove that I do. That's a great relief that the burden of proof is on them, not me and that if it turns out I did make that payment I won't be going under for perjury or something.

I'm going to get my discovery conference responses and amended answer together and then post here for suggestions before I send them off. Thanks to everyone for the assistance, I'm usually able to figure things out for myself but in this situation have been feeling quite helpless given it seems one tiny oversight will cost me the whole thing.  

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I forgot that the change was with prejudice. Even so, I doubt a FDCPA claim after the fact would work anyways.

As for filing the amended answer, I would do it anyways. You only really have to prove it when it gets to trial or if you file a motion to dismiss and you are far from that. You can demand what information the plaintiff has regarding that payment as part of your discovery and continue to work the banking angle. I would keep trying the 800 number for another day or 2 and if that does not work, maybe sending a notarized letter with your ID and a request for the records might do the trick. If not, consider calling the CFPB and explain to they your dilemma and see if they help either get the bank to be more amenable to give you the records or maybe force the plaintiff to come up with the payment information.

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For purposes of amended answer with counterclaim and affirmative defenses:

A potential FDCPA counterclaim not related to SOL issue would be dunning letter on law firm stationary, but not signed by attorney:

https://casetext.com/case/dunn-v-derrick-e-mcgavic

Just in case complaint was timely, seems best to have unrelated FDCPA claim. You can attach case law such as in above link.

Plaintiff will have 20 days to answer your counterclaim. Else you can apply for a default judgment against them.

For SOL defense just use date served and date you think you made last payment, difference between which is in excess of SOL. The main thing is to get the SOL defense/issue into the record.

Do not push plaintiff for discovery that would prove its case. Why ask for proof of alleged later payment? Don't do it.

On the sly, get your own bank records. //

General comment: Avoid answering complaints. Try to dispose of case in pre-answer stage by responding to lawsuit via motion. Failing that, since it's a bad idea for most people going to trial as a pro se, try disposing of case before trial - as it is, plaintiff will likely try to win before trial via MSJ. By raising SOL issue as an affirmative defense with answer, you are providing protection against possible plaintiff MSJ. Date of last payment would be a dandy remaining issue of material importance. Note that without asserting SOL defense, just responding with answer, you'd probably get run over by an MSJ because the record would not reflect remaining issues of material importance.

 

 

 

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@Happybluesky

57 minutes ago, Happybluesky said:

General comment: Avoid answering complaints. Try to dispose of case in pre-answer stage by responding to lawsuit via motion.

A motion to dismiss based upon the claim that a cause of action is time-barred must be supported with evidence.  Absent evidence, it's a waste of time.

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1 hour ago, BV80 said:

@Happybluesky

A motion to dismiss based upon the claim that a cause of action is time-barred must be supported with evidence.  Absent evidence, it's a waste of time.

What is this, tautology 101?

(By the way, it is the action, not cause of action, which is eventually time-barred.)

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2 hours ago, Happybluesky said:

For purposes of amended answer with counterclaim and affirmative defenses:

A potential FDCPA counterclaim not related to SOL issue would be dunning letter on law firm stationary, but not signed by attorney:

https://casetext.com/case/dunn-v-derrick-e-mcgavic

Just in case complaint was timely, seems best to have unrelated FDCPA claim. You can attach case law such as in above link.

Plaintiff will have 20 days to answer your counterclaim. Else you can apply for a default judgment against them.

For SOL defense just use date served and date you think you made last payment, difference between which is in excess of SOL. The main thing is to get the SOL defense/issue into the record.

Do not push plaintiff for discovery that would prove its case. Why ask for proof of alleged later payment? Don't do it.

On the sly, get your own bank records. //

General comment: Avoid answering complaints. Try to dispose of case in pre-answer stage by responding to lawsuit via motion. Failing that, since it's a bad idea for most people going to trial as a pro se, try disposing of case before trial - as it is, plaintiff will likely try to win before trial via MSJ. By raising SOL issue as an affirmative defense with answer, you are providing protection against possible plaintiff MSJ. Date of last payment would be a dandy remaining issue of material importance. Note that without asserting SOL defense, just responding with answer, you'd probably get run over by an MSJ because the record would not reflect remaining issues of material importance.

 

 

 

Hi @Happybluesky,

It makes sense to have a plan b in case the SOL thing falls through. However, I don't recall receiving any such letters. Also, in researching other potential FDCPA claims, I came across this post that cautions against filing counterclaims at all, and that if there is a valid claim to bring it to court in a separate lawsuit:

http://www.alabamaconsumer.com/2012/01/why-you-should-not-file-a-counterclaim-to-a-debt-buyer-lawsuit/

This makes sense to my personal situation, as my goal is not to sue Midland funding, my goal is to make them go away as inexpensively and with as minimal effort as is possible. And, hopefully, without a fresh judgment on my record. I'm finally starting to recover from the financial nightmare that got me into this situation with OC in the first place, and I hate to take such a huge step backward at this point as far as my credit goes. 

So I think I'm going to focus on the affirmative defenses rather than counterclaims; that way (I think?) the SOL issue is still on record, but I'm not unnecessarily complicating things for myself. Another concern is that even with what I'm learning here and elsewhere in my research, I'm still quite ignorant in the matter and so I'm reluctant to push too much on things I know so little about and shine a spotlight on that fact and/or hand them their judgment on a silver platter. 

As far as your comment regarding not pushing them for evidence of the debt, I see what you're saying here, but I have to fill out this discover plan so wouldn't I need to say what I intend to ask for there? And speaking of which, I still don't know how to word the seeking of "accounting to 0" (or is that simply what I put?) or the original signed credit card agreement or other documentation that I've read elsewhere on here that I should be asking for. Just totally flying blind here. 

Here is the question from the discovery plan document as posted in my original question:

2. The subjects on which discovery may be needed, when discovery should be completed, and whether discovery should be conducted in phases or be limited to or focused on particular issues:

a. Plaintiff:

Plaintiff will conduct discovery on the Defendant's opening of the account, use of the account and default. Plaintiff will seek discovery into the Defendant's receipt of the billing statements and any dispute made to the billing statements.

b. Defendant:

 

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Beachie:

Where is says defendant, say that you will make discovery on whether there is a signed contract, on an account of the account from 0, and whether a payment was truly made in November of 2010. That should cover what you wish to get out of discovery in that regard. Also, realize that discovery can change as material comes out in the case.

HappyBlueSky:

There is no real offense to be had as of yet because of the process here. You are in Oregon and that is a different set of rules. Here in Minnesota, the OP is best to follow the process and back the plaintiff into a corner where they will have to pay the fees and get this into court with a possibility of losing because there are trialable issue to be resolved by the court. To do that, the OP must follow the process whether, however weird it is. Many plaintiffs have walked away from these cases once they see that the defendant is planning on fighting because so few do so that it is not worth their effort. Also, Beachie has one year from the lawsuit to file a separate FDCPA case which can be done in a different court (Federal Court) if they wish. The current stated goal of the OP is to try to get out of this with as little expense as possible. This does mean however that the OP will have to show some effort to prove that a payment was not made such as trying to get the bank records of where the OP did most of their banking at the time.

You can hate the process but if you are in Minnesota, that is what it is and as I said before, it is not going to change because of too many intrenched special interests who like this process.

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Maybe it's because I'm not in MN, but I would consider a different approach.  OP, what are your goals in this?  Do you want to just make them go away or are you looking to take action against them? 

I would consider going all out right now, applying pressure.  99.9% of the time, these "timely payments" are bogus, made up specifically to counter the SOL defense.  What does everyone think about the following?

1, amend answer, include SOL defense

2, file counter claim with answer, alleging FDCPA violations.  I see two potential violations in addition to what was mentioned about the letter.  First is suing beyond SOL.  Second is misrepresenting the amount, character, and status of a debt, when they lied and said that there was a payment made in 2010, that was a violation. 

If OP sends pocket docket for counter suit, it will send a message that he is not going to play around with these JDBs.  They will know that they either have to be telling the truth or they will be put in a corner.  It will not cost the OP any filing fees to send the JDB a copy of what he would file, just as they have done, and he is not locked into anything in the courts this way because of pocket docket.  It could be enough to make them blink and move on to easier targets.  Plus, there is no penalty against the OP for doing this, as there could be with the JDB and an FDCPA issue.  If the JDB blinks, and decides to back down, that might even give rise to an FDCPA claim for notifying the OP of legal action that they did not intend to follow through with.

You guys know MN better than me, what do you think about laying it all out like this?

Wheels up,

Stick

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@stick&rudder

1 hour ago, stick&rudder said:

would consider going all out right now, applying pressure.  99.9% of the time, these "timely payments" are bogus, made up specifically to counter the SOL defense.  What does everyone think about the following?

1, amend answer, include SOL defense

2, file counter claim with answer, alleging FDCPA violations.  I see two potential violations in addition to what was mentioned about the letter.  First is suing beyond SOL.  Second is misrepresenting the amount, character, and status of a debt, when they lied and said that there was a payment made in 2010, that was a violation. 

If OP sends pocket docket for counter suit, it will send a message that he is not going to play around with these JDBs.  They will know that they either have to be telling the truth or they will be put in a corner.  It will not cost the OP any filing fees to send the JDB a copy of what he would file, just as they have done, and he is not locked into anything in the courts this way because of pocket docket.  It could be enough to make them blink and move on to easier targets.  Plus, there is no penalty against the OP for doing this, as there could be with the JDB and an FDCPA issue.  If the JDB blinks, and decides to back down, that might even give rise to an FDCPA claim for notifying the OP of legal action that they did not intend to follow through with.

In my opinion, that's a viable course of action.   Hopefully, the Midland's attorney is of the lazy variety who'll simply drop the case.   However, if he's more aggressive, he'll rely on the fact that an affirmative defense and FDCPA claim have to be proven by the defendant.

I'm not sure that backing down would give rise to an FDCPA complaint for the reasons I stated previously.   More than likely, the OP would have to show a pattern of backing down when defendants intend to defend.

It might help if we could see a copy of the complaint and other documentation provided by Midland in order to compare it all to the information in the CFPB Consent Order.   As it stands right now, Midland didn't have to provide account-level documentation with the complaint.  BUT, they do have to provide it if they intend to prosecute.

If the OP just wants this over and done, initiating arbitration might work if he can come up with a GEMB agreement from 2009 or before that contains an arbitration provision.

@beachie12

Would you might letting us see the complaint and other documentation?

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1 hour ago, stick&rudder said:

1, amend answer, include SOL defense

2, file counter claim with answer, alleging FDCPA violations.  I see two potential violations in addition to what was mentioned about the letter.  First is suing beyond SOL.  Second is misrepresenting the amount, character, and status of a debt, when they lied and said that there was a payment made in 2010, that was a violation. 

^^^ is what I would do.

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I think they will drop it.  Midland did not buy the debt until 2014.  They are relying on heresay records, and they know it.  Sending the ammended answer and counterclaim shows them you will fight.  They are not going to pursue this. Then you have an option if they do not pursue of filing your own FDCPA case in small claims, or hire an attorney to do it for you. Or just let the issue die.  Midland is not going to chance it on heresay records with mor than 1 in the chain of assignment.  They would have to prove that payment, and would not be able to.

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@shellieh98

5 minutes ago, shellieh98 said:

I think they will drop it.  Midland did not buy the debt until 2014.  They are relying on heresay records, and they know it.  Sending the ammended answer and counterclaim shows them you will fight.  They are not going to pursue this. Then you have an option if they do not pursue of filing your own FDCPA case in small claims, or hire an attorney to do it for you. Or just let the issue die.  Midland is not going to chance it on heresay records with mor than 1 in the chain of assignment.  They would have to prove that payment, and would not be able to.

I'm not sure how much of the decision to prosecute is determined by Midland.  I wonder if it's not also determined by the attorneys representing the company.  

Court precedent isn't created when a plaintiff drops a lawsuit.  If Midland always backed down because of hearsay records or more than one in the chain of assignment, there would be no precedent.   That's what makes me wonder if the attorney doesn't have some say in the decision.

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3 minutes ago, BV80 said:

@shellieh98

I'm not sure how much of the decision to prosecute is determined by Midland.  I wonder if it's not also determined by the attorneys representing the company.  

Court precedent isn't created when a plaintiff drops a lawsuit.  If Midland always backed down because of hearsay records or more than one in the chain of assignment, there would be no precedent.   That's what makes me wonder if the attorney doesn't have some say in the decision.

I think the attorneys have most of the say.  In fact I think the only time midland has any say is when the attorney wants to dismiss, he may "advise" midland.  Collection attorneys should know the stakes.  Unless they are getting paid by the hour (most are contracted for simple suits xx dollars) they are not going to want to spend much time on this.

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@shellieh98

1 minute ago, shellieh98 said:

Unless they are getting paid by the hour (most are contracted for simple suits xx dollars) they are not going to want to spend much time on this.

I agree that's true in some instances but not in all.  There's a debt collection law firm in my state that is very aggressive.  It doesn't hesitate to file a motion to compel a defendant's bank records in order to prove payments were made.   Either those attorneys just work hard for their clients or they just hate to lose.

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Pocket docket certainly is different.

OP plan looks good, and hopefully the year will go by uneventfully.

Then the case would be dismissed with prejudice, which is the same result as winning the case outright.

 

 

 

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5 hours ago, WhoCares1000 said:

Beachie:

Where is says defendant, say that you will make discovery on whether there is a signed contract, on an account of the account from 0, and whether a payment was truly made in November of 2010. That should cover what you wish to get out of discovery in that regard. Also, realize that discovery can change as material comes out in the case.

 

@WhoCares1000 Thanks for this. Although I wonder if the account from 0 is even going to be needed/permissible, and if the documentation validating the debt that they sent me w/this discovery plan is enough for the courts already. In which case, SOL does seem to be my only hope here. I've made notes below here as to what they've sent me, would love to get your/everyone's take on whether they need more evidence than they've provided to win in court:

Sec. 3. 

[548.101] ASSIGNED CONSUMER DEBT DEFAULT JUDGMENTS.

(a) A party entitled to a judgment by default in a conciliation court or district court 
action upon an assigned obligation arising out of any consumer debt that is primarily for 
personal, family, or household purposes and in default at the time of assignment shall apply 
to the court and submit, in addition to the request, application, or motion for judgment:

(1) a copy of the written contract between the debtor and original creditor or, if no 
written contract exists, other admissible evidence establishing the terms of the account 
relationship between the debtor and the original creditor, including the moving party's 
entitlement to the amounts described in clause (4). If only the balance owed at the time 
the debt was charged off or first assigned is claimed to be owed, evidence may include 
a monthly or periodic billing statement;

***They are only asking for the amount owed when it was charged off, less the alleged $100 payment from 2010; they sent me a copy of the last statement from GEMB, which presumably would satisfy this requirement.

(2) admissible evidence establishing that the defendant owes the debt;

*** I would assume the final billing statement from GEMB in addition to the bills of sale they sent me for each time the debt changed hands would suffice. The one question I have with this is that the bills of sale are generic lump sum sales and don't point specifically to this debt.

(3) the last four numbers of the debtor's Social Security number, if known;

***Yes

(4) admissible evidence establishing that the amount claimed to be owed is accurate, 
including the balance owed at the time the debt was charged off or first assigned to another 
party by the original creditor and, if included in the request, application, or motion for 
judgment, a breakdown of any fees, interest, and charges added to that amount;

***They haven't added any interest, fees or charges to the original charge off amount. Again I assume that the final billing statement would be proof that the amount owed is accurate.

(5) admissible evidence establishing a valid and complete chain of assignment of the 
debt from the original creditor to the party requesting judgment, including documentation 
or a bill of sale evidencing the assignment with evidence that the particular debt at issue 
was included in the assignment referenced in the documentation or bill of sale;

***Chain of assignment---Yes. They included a document that at the top states the charge-off amount, the alleged payment made in 2010, and the final amount that they are saying I owe them. Underneath that it says chain of title and lists GEMB, Asset Recovery Solutions, Asset Acceptance, and Midland, which is correct as far as I know. 

To recap, here is the list of verification documents they sent me:

1. Chain of Title as described above.

2. GEMB final statement.

3. Generic Bill of Sale from GE to Asset Recover Solutions dated June 09, 2009. It has a little spreadsheet printout that has the months of Oct-Dec 2009 and minimum and maximum allowed face value, all of which are blacked out except the months.

4. Affidavit of Sale of Account by Original Creditor which says on or around 10/26/09 GE sold a pool of accounts to Asset Recovery. the person says they aren't aware of any errors in the accounts and the affidavit is signed March 17, 2011.There is also a 'Blanket Certificate of Conformity for Notary Matthew Peterson' (the person who signed the affidavit) that was signed on March 16, 2011.

5. Another affidavit of sale signed by Matthew Peterson for the sale of another pool of debts sold by GEMB to Asset Recovery, this time the date is 11/24/09. This also includes the Blanket Certificate and the dates the affidavit and certificate were signed are same as above.

6. Same as above for the third pool of debt that was sold, this time the sale date is 12/22/09, everything else is the same.

7. "Exhibit 2" which is Bill of Sale from Asset Recovery to Asset Acceptance dated June 18, 2012. This comes w/affidavit of bulk sale of accounts and certificate of conformity.

8.  A notarized statement from someone at Asset Acceptance saying that a pool of accounts were sold to Midland on 10/14/13. She also mentions the accounts being purchased from Asset Recovery on 6/18/2012 and that OC is GEMB. A copy of the bill of sale is included with this.

9. Finally, we have a generic printout that says it's data printed by Midland from electronic records provided by Asset Acceptance. It lists the original acct number, my personal info, open date, charge off date, last payment date and amount (that $100), and sale amount of $2754.74.

To my untrained eye, it would appear that they have covered their bases enough for the claim to hold up in court. I'm hoping someone here with more experience in these matters will point out any red flags, if any. 

 

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