42 state attorneys general settle robosigning allegations with Midland debt buyer
Forty-two state attorneys general and the District of Columbia settled allegations that Midland Funding and Midland Credit Management used robosigned affidavits in debt collection cases, under an agreement calling for a $6 million payment and compliance changes.
Forty-two state attorneys general and the District of Columbia reached an agreement with Encore Capital Group subsidiaries Midland Funding and Midland Credit Management to resolve allegations over debt-collection affidavits, according to a Consumer Finance Monitor report published Dec. 6, 2018.
Illinois officials said the allegations involved affidavits signed and filed in state courts in large volumes without verifying the information in them, a practice often called robosigning.
According to the report, the agreement is an Assurance of Voluntary Compliance and Assurance of Discontinuance. It requires Midland to pay $6 million to the states. The attorneys general may use that money for attorney’s fees, investigative costs, consumer education, litigation, and other consumer-protection purposes listed in the agreement.
The settlement also calls for Midland to set aside $25,000 per state for consumer restitution internally, and to provide a credit of up to $1,850 to the outstanding balance of certain judgments involving disputed debts.
The report said Midland is one of the nation’s largest debt buyers, according to an Illinois attorney general press release cited in the article. The allegations centered on the company’s use of affidavits in state court debt-collection cases.
Midland said in a press release that the practices at issue had not been the company’s practice for nearly 10 years. It also said it believed its practices complied with relevant laws, but chose to settle so the parties could move ahead. Midland said nearly all of the operational requirements were already part of its current practice and most had been implemented during or before negotiations with the attorneys general.
Under the agreement, Midland must comply with the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, and applicable state laws. The company also must appropriately staff teams that handle disputes and consumer questions, maintain mandatory employee training, and conduct call monitoring.
The Consumer Finance Monitor report does not give a separate date for when the agreement was signed beyond the publication date of the article.
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Editorial note: This article was prepared with AI assistance and includes source attribution for reader review.
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