New York AG Cuomo Closes Collection Agencies

New York Attorney General Andrew Cuomo is continuing his crusade against rogue debt collectors. His office announced on Wednesday that they have launched a statewide inquiry into debt collection agencies.

In addition, they have obtained a court order against Lamont Cooper and his two debt collection companies, Emanee Development, Inc. and Dial Tech LLC, under which the companies will shut down and Cooper will be forced to pay restitution to consumers statewide.

According to Cuomo’s Office, Cooper’s collections companies unlawfully lied to consumers, threatened to arrest them, and intimidated them into paying debts that they sometimes did not even owe. They would often call third parties like neighbors or employers to further embarrass and harass consumers. Emanee and Dial Tech allegedly did business under the names of various shell companies and fictitious law firms across the state, including: Claims Process Services, Claims America, CMC Recovery Services, Lomax & Barnes and Murray, Bradshaw & Associates.

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The fallout from Dateline NBC’s debt collections episode has generated a real buzz in the collections industry.

Just this week we saw this editorial from InsideARM, which offers some pretty good rebuttals to all the collection agency boneheads that were posting on that site. All of their comments since the airing have been about how unfair Dateline’s treatment was of the “Asset Receivable Industry.”

Then, of course, you have NARCA (National Association of Retail Collections Attorneys) coming out with their press release arguing about how unfair the treatment was by NBC’s Dateline.

The point that these debt collectors continue to miss is that Dateline NBC and reporter Chris Hansen never claimed they were showing typical behavior of the debt collection industry. They simply were showing that in many cases (and they did show a number of them), there were horrible debt collectors, such as LHR, out there that are violating debtors’ rights with little or no regard for the law. “Where’s the Outrage” from Paul Legrady makes that point very well and challenges his colleagues in debt collection to try and work toward fixing the bad actors and not just griping about press coverage.

I could not agree more.

Dateline NBC and Chris Hansen aired a segment on Friday night that highlighted the growing debt problem in the United States and focused specifically on debt collection agencies and their shady collection tactics.

Harvard Law Professor and Debt Expert Elizabeth Warren

This episode is a must see for anyone interested in debt and debt collection. So, if you had better things to do on Friday night than sit around and watch TV shows about debt collection, the complete episode in 6 segments is below with a summary of content of each section.

The first two sections feature profiles of debt and an interview with Harvard Law Professor Elizabeth Warren. Professor Warren says in this segment that credit card debt is a huge problem in the U.S. today and is destroying the middle class. She sites the “tricks and traps” that credit card companies use to lure consumers into debt: “Credit card companies have put the loan sharks out of business… [they] would make Tony Soprano blush.” Pretty strong words against the credit card industry, but Professor Warren has never been afraid to take credit card debt issues on head on.

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Dateline NBC's Chris Hanson

Debt Collectors will get the Dateline NBC treatment on Friday night, March 27th at 10pm Eastern and Pacific. Reporter Chris Hanson, most famous for his work exposing child predators on “To Catch a Predator,” will “expose dirty tactics used by some collection agencies.” According to NBC, hidden cameras will be involved, so this should be a really interesting show to watch on Friday night.

The episode of Dateline is titled “Debt in America and Its Collectors” and is part of a series called “Inside the Financial Fiasco.” Collection agencies abusing consumers is a serious issue in our country and it is great to see Dateline NBC and Chris Hanson tackling this issue with their trademark style.

However, everyone is not so excited. Without even having seen anything but the preview (below), Patrick Lunsford of InsideARM is lamenting the fact that it will be unfair and biased, with this from his article on the show:

To pre-suppose that the show will be an unfair view of the ARM industry is a bit beyond us at this point. I seriously can’t imagine what manner of awfulness will be foisted upon the public in this segment. I guess that we should withhold judgment until the piece airs, but I can’t see a piece that touts itself as a hidden camera expose of the ARM industry being even-sided.

While it’s always great to see “foisted” used in an article, I’m not sure how Patrick already knows the show will be so unfair? Maybe, it’s because Patrick, as an InsideARM expert, is well aware that there are a lot of debt collectors out there breaking the law every day, and if Chris Hanson is on the case, he’s bound to expose a number of them on national TV Friday night. Even better than Patrick’s “warning” to fellow debt collectors are the comments below the post. Apparently it’s not required to take an economics class to be a debt collector.

Tune in on Friday night or check back here on Saturday for an update on the episode.