Bureau wants to punish law firm for alleged phony involvement of attorneys in debt collection suits

Attorneys at a law firm were not “meaningfully involved” in preparing or filing lawsuits over debt collection despite the law firm’s alleged representation that they were – and that was enough to trigger a lawsuit by the federal consumer financial protection agency.

Friday, the Consumer Financial Protection Bureau (CFPB) said it had filed a suit against the law firm Forster & Garber, LLP, which the bureau described as a New York debt-collection law firm. CFPB said its complaint alleges that the law firm violated the Fair Debt Collection Practices Act (FDCPA) by “representing to consumers that attorneys were meaningfully involved in its lawsuits when, in fact, attorneys were not meaningfully involved in preparing or filing them.”

The agency also said its complaint alleges that Forster & Garbus violated the Consumer Financial Protection Act’s (CFPA) prohibition against deceptive acts and practices by making such representations to consumers through its lawsuits.

In its complaint, CFPB said that, since at least January 2014, the law firm “has relied on non-attorney support staff, automation, and both a cursory and deficient review of account files to attempt to collect more than 99,000 debts that consumers allegedly owe to Forster & Garbus’s clients.” The complaint states that “using high-volume litigation tactics, Forster & Garbus collects substantial sums of money from consumers who may not actually owe debts or may not owe debts in the amounts claimed in the collection suits.”

The agency complaint asks the court to permanently enjoin the firm from committing future violations of the FDCPA and CFPA and to award damages against the firm, redress to consumers, disgorgement of “ill-gotten gains,” and imposition of a civil money penalty (CMPs), CFPB said.

CFPB federal district court case: Forster & Garbus, LLP