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Office of the Commissioner of Financial Regulation

 

Maryland Commissioner of Financial Regulation Reaches Settlement Agreement with National Collection Agency

 

BALTIMORE (August 26, 2010) - Sarah Bloom Raskin, Maryland Commissioner of Financial Regulation, today announced the State reached an agreement with Worldwide Asset Management, LLC, Worldwide Asset Purchasing, LLC, West Asset Purchasing, LLC, and other affiliated companies to settle alleged violations of federal and state debt collection laws while engaging in litigation-related collection activities in Maryland State courts.

Under the terms of the Settlement Agreement with the State Collection Agency Licensing Board, an agency within the Office of the Commissioner, a division of the Department of Labor, Licensing and Regulation, the Worldwide-West companies will pay a civil penalty totaling $85,000 and conform their business practices to ensure that both their litigation-related collection activities, as well as their non-litigation (or "traditional") debt collection activities, comply with all applicable state and federal laws. These laws include the Maryland Collection Agency Licensing Act, the Maryland Consumer Debt Collection Act, the Maryland Rules of Civil Procedure, and the federal Fair Debt Collection Practices Act.

The Worldwide-West companies, which did not admit any wrongdoing under the terms of the agreement, have ceased filing new collections-related actions in Maryland State courts. The companies agreed that they are subject to the regulatory authority of the Board when bringing actions in Maryland State courts to collect consumer debt; they also agreed to become licensed as appropriate should they initiate actions again. The Settlement Agreement (PDF document, 848KB, download Adobe Acrobat for free) is available on the Commissioner's website.

"As collection agencies have turned to litigation as a core business strategy and filed tens of thousands of suits statewide, we have seen significant problems with the practices that are employed," said Deputy Commissioner Mark Kaufman. "Consumers often fail to contest these lawsuits or are unaware of their rights, so regulatory oversight of litigation-related debt collection activities is an important protection."

The settlement does not impact pending actions or limit the rights of consumers against Worldwide-West, but rather commits the companies to making changes in their debt collection practices. In December 2009, the State Collection Agency Licensing Board reached a settlement with Encore Capital Group and affiliated entities related to litigation activities that included a $998,000 fine.

"This settlement demonstrates our commitment to ensuring that consumers receive all of the protections to which they are entitled," noted Deputy Commissioner Kaufman. "Collection agencies involved in this type of litigation must fully adhere to licensing requirements, to the Maryland Rules of Civil Procedures, as well as to the federal and State debt collection laws."