Recently, the CFPB and New York Attorney General filed a Complaint against Douglas MacKinnon and members of his immediate family to unwind the allegedly fraudulent conveyance of MacKinnon’s $1.6 million home made shortly after he learned his business practices were the subject of CFPB and NYAG investigations.

This Complaint follows a 2019 consent decree, in which MacKinnon was one of three defendants who had entered a stipulated final judgment with the CFPB and NYAG.  In that action, the CFPB and NYAG charged McKinnon and others with having purchased millions of dollars’ worth of consumer debt at a fraction of its value, then inflating the debts, and using illegal tactics – including, impersonating law enforcement officers, government agencies, and court officers – to extract as much money as possible from consumers.  The stipulated order settling that action required MacKinnon and his co-defendants to pay $60 million – $40 million in consumer redress, and a $10 million penalty to the CFPB and a $10 million penalty to NYAG.  However, the consent decree suspended the payment of these amounts in exchange for $10,000 in consumer redress and $1 to the CFPB.

The recently filed Complaint alleges MacKinnon transferred ownership of his home to his wife and daughter in 2015 in exchange for just $1 shortly after learning of the federal and state investigations into his debt collection companies.  Shortly thereafter, the Complaint alleges, MacKinnon’s wife granted a mortgage of $900,000 to MacKinnon’s brother in order to give the impression that the property was encumbered and not available to pay any of MacKinnon’s creditors.  In the Complaint, the CFPB and NYAG ask the court to declare the transfer and subsequent mortgage void and order the sale of the property in order to satisfy, at least partially, MacKinnon’s outstanding debt to the federal and state governments.  The CFPB reports that MacKinnon has not made any payments toward satisfying the judgment against him since the 2019 consent decree, and alleges that neither he nor his family members have cooperated in the efforts to obtain relevant financial information.

The CFPB issued a press release after filing the Complaint in which Acting CFPB Director Dave Uejio strongly condemned MacKinnon’s actions and signaled that the CFPB intended the Complaint to act as a warning to other fraudsters.  Mr. Uejio stated that “Douglas MacKinnon operated a brazen scheme, fraudulently inflating consumers’ debts, and he was equally brazen in trying to fraudulently conceal his own assets.” He went on to note that the Complaint “shows that attempts to defraud the federal government and evade the consequences of breaking the law will not succeed.”  The press release also included NYAG Letitia James’s comment that she considered MacKinnon’s conduct to be a “complete disregard for the authority of the government to bring violators of the law to justice.” She also noted that “[n]ot a single dime has been paid to put money back into the pockets of New York’s consumers.”