New Mexico Joins Operation Labeled “Corrupt Collector” and Sues Three Collection Agencies

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New Mexico’s Attorney General Hector Balderas announced on September 29 that his office has filed three lawsuits against debt collection companies. In his statement, Balderas explained that these lawsuits are part of a larger “crackdown” aimed at educating consumers and eliminating abusive debt collection practices within the state.

The lawsuits, filed against LVNV Funding, Central Mediation Services, and Capio Partner, LLC, allege that these companies:

  • Illegally induced consumers into paying debt by making fraudulent misrepresentations about the debts;
  • Engaged in abusive and predatory practices; and
  • Forced consumers to pay debts they did not owe.

New Mexico joins the Federal Trade Commission and more than 50 federal and state law enforcement partners in a joint effort to curtail abusive debt collection practices. The initiative called Operation Corrupt Collector has already provided information to help consumers know their rights related to debt collection, including an online dashboard with information about reports received from consumers. In addition to the three lawsuits brought by New Mexico’s Attorney General, Operation Corrupt Collector includes five cases filed by the FTC, two cases filed by the Consumer Financial Protection Bureau, and three criminal cases brought by the U.S. Department of Justice and U.S. Postal Inspection Service.

Troutman Pepper will continue to provide updates as the cases develop.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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