Debt collection -- Attempts to collect debt not owed -- Complaint #8898721
Debt Collector Pursues Bankrupt Consumer Despite Discharge and Cease Communication Request
Complaint Overview
Complaint ID: 8898721
Company: Resurgent Capital Services L.P.
Product: Debt collection
Sub-Product: Payday loan debt
Issue: Attempts to collect debt not owed
Sub-Issue: Debt was already discharged in bankruptcy and is no longer owed
State: Florida
ZIP Code: 34772
Date Received: 2024-04-30T12:00:00-05:00
Date Sent to Company: 2024-04-30T12:00:00-05:00
Company Response: Closed with explanation
Timely Response: Yes
Consumer Disputed: N/A
Submitted Via: Web
Risk Assessment
Risk Level: critical
The complaint involves attempts to collect a debt that the consumer states was discharged in bankruptcy, which is a serious violation of federal law. Continued collection attempts after a bankruptcy discharge and a cease communication request indicate a high likelihood of FDCPA violations.
Consumer Sentiment: frustrated
Topics: debt-collection, payday-loan-debt, attempting-to-collect-debt-not-owed, debt-discharged-in-bankruptcy, resurgent-capital-services, fdcpa-violation
AI Analysis
This complaint describes a distressing situation where a consumer is being pursued for a debt that they believe is no longer valid. The consumer states that the original creditor wrote off the debt, meaning it was deemed uncollectible and likely sold to a debt collector for pennies on the dollar. Furthermore, the consumer asserts that this debt was already discharged in bankruptcy, a legal process that, when completed, legally releases the debtor from personal liability for most debts. Despite sending a certified letter requesting proof of the debt's validity and demanding a cessation of communications, the consumer continues to receive calls from various numbers associated with the debt collector, Resurgent Capital Services L.P. This is a serious issue because debt collectors are legally obligated to cease communication once a debt has been discharged in bankruptcy and must provide validation of the debt when requested. The continued collection attempts, especially after a bankruptcy discharge, can be a violation of federal law and cause significant emotional distress. This pattern of behavior, while not unique to Resurgent Capital Services, is unfortunately common in the debt collection industry, particularly with purchased debt portfolios where documentation can be incomplete or errors occur. The company's response of 'Closed with explanation' suggests they may have provided some justification for their actions, but it doesn't necessarily mean the consumer's rights were respected or that the debt is indeed validly owed. For others in similar situations, it highlights the importance of understanding bankruptcy discharge orders and knowing their rights under the Fair Debt Collection Practices Act (FDCPA).
Consumer Narrative
the original debtor XXXX XXXX wrote off the debt making it no longer being due. On XX/XX/2024 I submitted a certified letter LVNV to submit proof of aggravated value of purchase. I also requested that they stop all form of communication. I continue to receive calls from all kinds of phone numbers and when searched via XXXX it advises the numbers are tied to there organization.
What You Should Do -- Consumer Action Plan
1. **Gather all documentation:** Collect copies of your bankruptcy discharge order, the certified letter you sent to Resurgent Capital Services (including proof of mailing/delivery), and any records of calls received (dates, times, numbers, content). 2. **File a formal complaint with the CFPB:** If you haven't already, file a detailed complaint with the Consumer Financial Protection Bureau (CFPB) at consumerfinance.gov. Reference your previous complaint and add the new information about continued calls and the bankruptcy discharge. 3. **Contact your bankruptcy attorney:** If you used an attorney for your bankruptcy, contact them immediately. They can send a strongly worded letter to Resurgent Capital Services on your behalf, which often resolves the issue quickly. They can also advise on potential legal action for violating the discharge order. 4. **Consider a formal FDCPA lawsuit:** If the collection attempts continue and your attorney advises it, you may have grounds to sue Resurgent Capital Services under the FDCPA for damages, including statutory damages and attorney's fees. 5. **Report to the FTC and Florida Attorney General:** File complaints with the Federal Trade Commission (FTC) and the Florida Attorney General's office, as these agencies also handle consumer protection issues.
Legal Context & Consumer Protection Laws
The Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors from using deceptive or abusive practices, including attempting to collect debts that are not legally owed, such as those discharged in bankruptcy. The Bankruptcy Code also provides protections, making it illegal for creditors or collectors to attempt to collect debts that have been discharged. This complaint may involve violations of both the FDCPA and the Bankruptcy Code.
Regulatory Insight
This complaint pattern, where debt collectors pursue debts already discharged in bankruptcy, suggests systemic issues within the debt collection industry, particularly concerning purchased debt portfolios. Incomplete record-keeping and a lack of diligence in verifying debt status before collection attempts are common problems. The CFPB has previously taken enforcement actions against debt collectors for violations related to collecting discharged debts and for failing to cease communication as requested.
Resolution Likelihood
30%
State-Specific Consumer Protections
Florida has its own debt collection laws that may offer additional protections beyond federal law. The Florida Consumer Collection Practices Act (FCCPA) mirrors many FDCPA provisions and prohibits unfair or unconscionable debt collection practices. The Florida Attorney General's office is the primary state agency responsible for enforcing these laws.
Industry Comparison
Resurgent Capital Services, like many debt collection agencies that purchase charged-off debt, operates in a challenging environment where documentation can be fragmented. Their response of 'Closed with explanation' is a common industry practice, but the continued calls after a bankruptcy discharge and cease communication request suggest a potential lapse in their internal compliance procedures compared to more diligent collectors.
Related Issues
Frequently Asked Questions
Why is Resurgent Capital Services still calling me if my debt was discharged in bankruptcy?
If your debt was legally discharged in bankruptcy, Resurgent Capital Services is generally prohibited from attempting to collect it. This is a violation of the Bankruptcy Code's discharge injunction. They may be continuing to call due to an error in their records, a failure to properly update their systems after the bankruptcy, or a deliberate attempt to collect a debt they know is discharged. It's crucial to have your bankruptcy discharge order readily available and to inform them in writing (and ideally through your bankruptcy attorney) that the debt was discharged. Continued calls after this notification could lead to further legal action against the debt collector.
What are my legal rights when a debt collector tries to collect a debt that was discharged in bankruptcy?
When a debt is discharged in bankruptcy, you are legally released from personal liability for that debt. The Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors from attempting to collect debts that are not owed. Furthermore, the Bankruptcy Code includes a 'discharge injunction' that permanently prohibits creditors and debt collectors from taking any action to collect a discharged debt. If a collector violates this, you may be able to sue them for damages, including actual damages, statutory damages, and attorney's fees, under both the FDCPA and the Bankruptcy Code. It is highly recommended to consult with your bankruptcy attorney immediately.
Should I file a complaint with the CFPB if Resurgent Capital Services is still calling me about a discharged debt?
Yes, absolutely. Filing a complaint with the CFPB is a critical step. Provide all details: the debt was discharged in bankruptcy (attach proof if possible), you sent a certified letter requesting validation and to cease communication, and they are still calling. The CFPB can investigate the company's practices and potentially take enforcement action. While the CFPB's investigation may not directly resolve your individual case or provide monetary compensation, it contributes to holding the company accountable and can prompt them to correct their behavior. It's also advisable to file complaints with your state Attorney General and the FTC.
What is Resurgent Capital Services' track record with debt collection and bankruptcy issues?
Resurgent Capital Services is a debt collector that often purchases portfolios of charged-off debt. Like many companies in this sector, they have faced scrutiny and complaints regarding their collection practices. While specific data on their bankruptcy discharge handling isn't always publicly aggregated, complaints to the CFPB and other agencies often involve disputes over debt validity, communication violations, and issues with purchased debt. Consumers should be aware that debt collectors may acquire debts with incomplete documentation, leading to potential errors in collection attempts, especially concerning debts that have gone through bankruptcy.
What are my next steps if Resurgent Capital Services continues to call after I've notified them about the bankruptcy discharge?
If Resurgent Capital Services continues to call after you've formally notified them of the bankruptcy discharge (preferably in writing and via your attorney), your next steps should be aggressive. First, ensure your bankruptcy attorney is involved; they can send a formal demand letter threatening legal action for violating the discharge injunction. Second, continue documenting every single communication. Third, consider filing a lawsuit against Resurgent Capital Services for violating the discharge injunction and potentially the FDCPA. Many attorneys take these cases on a contingency basis, meaning you won't pay upfront fees, and they seek their fees from the defendant if you win.
How can collection attempts on a discharged debt affect my credit score?
Collection attempts on a debt that has been discharged in bankruptcy can negatively impact your credit score, even though the debt is no longer legally owed. If the debt collector incorrectly reports the debt as active and delinquent to credit bureaus, it can lower your score. This is particularly damaging because bankruptcy itself already lowers your score. It's crucial to monitor your credit reports closely after bankruptcy and dispute any inaccurate information, especially collection attempts on discharged debts. You can obtain free credit reports from AnnualCreditReport.com.
Are there any class action lawsuits against Resurgent Capital Services for similar issues?
It is possible that Resurgent Capital Services has been involved in class action lawsuits related to debt collection practices, including issues with discharged debts or FDCPA violations. To determine if there is an active or past class action relevant to your situation, you should consult with a consumer protection attorney specializing in class actions or search legal databases and consumer advocacy websites. Class action lawsuits aggregate claims from many consumers with similar grievances, potentially leading to broader settlements or changes in company practices. Your bankruptcy attorney may also have insights into potential class actions.
Disclaimer
This analysis is generated by an AI and is for informational purposes only. It does not constitute legal advice. You should consult with a qualified legal professional for advice specific to your situation.