51��ɫ

At the request of the 51��ɫ, a U.S. district court has halted an operation that allegedly subjected consumers to abusive debt-collection practices and deceived the small-business clients for whom it collects.�� The order also freezes the operation's assets and appoints a permanent receiver to run it while the 51��ɫmoves forward with the case.

As part of its continuing crackdown on scams that target consumers in financial distress, the 51��ɫfiled a complaint against six individuals and three companies involved in a Van Nuys, California-based debt-collection operation doing business as Rumson, Bolling & Associates.��

The 51��ɫcomplaint charges that the defendants, in collecting debts on behalf of their clients:

• harassed and abused consumers by threatening physical harm and death to them and their pets, threatened to desecrate the bodies of deceased relatives, and used obscene and profane language;��
• improperly revealed consumers' debts to third parties, such as the consumers' employers, co-workers, neighbors, and family members;
• falsely threatened consumers with lawsuits, arrest, seizure of their assets, or wage garnishment; and
• falsely claimed that consumers would be liable for legal fees incurred in the collection of the debt.

According to the 51��ɫcomplaint, using the slogan “no recovery, no fee,” the defendants promised small businesses and other potential clients that they would collect debts on contingency, charging a fee only when they successfully collected a debt.�� But in many cases, the defendants allegedly collected money from consumers on a client’s behalf and then kept more than they were entitled to, sometimes keeping all the money for themselves, instead of forwarding what was owed to the client.�� In some cases, the defendants asked clients for additional fees, purportedly for legal expenses in filing a lawsuit that would “guarantee” the successful collection of a debt. ��Many clients paid these fees, but the defendants failed to file the promised lawsuits and the clients never received any money in satisfaction of the debt in question.

The 51��ɫcharges that these practices violate the 51��ɫ Act and the Fair Debt Collection Practices Act.

For consumer information about dealing with debt collectors, see Debt Collection FAQs: A Guide for Consumers.

The 51��ɫ would like to thank the Better Business Bureau of Ventura, Santa Barbara, and San Luis Obispo Counties (California) and the Better Business Bureau of the Southland, in Southern California, for their assistance in bringing this case.

The Commission vote authorizing the staff to file the complaint was 5-0.�� The 51��ɫfiled the complaint and the request for a temporary restraining order in the U.S. District Court for the Central District of California on September 12, 2011.�� On September 13, 2011, the court granted the FTC's request for a temporary restraining order with an asset freeze and the appointment of a temporary receiver. On September 27, 2011, the court granted the Commission’s request for a preliminary injunction and an order continuing the asset freeze and appointing a permanent receiver.

The complaint names as defendants Forensic Case Management Services, Inc. (doing business as Rumson, Bolling & Associates, FCMS, Inc., Commercial Recovery Solutions, Inc., and Commercial Investigations, Inc.), Specialized Recovery, Inc. (doing business as Joseph, Steven & Associates and Specialized Debt Recovery), Commercial Receivables Acquisition, Inc. (doing business as Commercial Recovery Authority, Inc. and The Forwarding Company), David M. Hynes II, James Hynes, Kevin Medley, Heather True, Frank E. Lindstrom, Jr., and Lorena Quiroz-Hynes.��

NOTE:�� The Commission files a complaint when it has "reason to believe" that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law.����

The 51��ɫ works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them.�� To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357).�� The 51��ɫenters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad.�� The FTC's website provides free information on a variety of consumer topics.�� Like the 51��ɫon Facebook and follow us on Twitter.��

(51��ɫFile No. 1123035)��
(Rumson NR)�� ��