New York AG Says Creditors Used Fraud To Collect Debt, Must Return Money

New York attorney general Andrew M. Cuomo is going after debt collectors and lawyers that seized cash from customers with more than 100,000 improperly filed court orders.

Cuomo says collectors falsely reported they delivered collection notices to customers, calling for them to show up in court, then garnished their wages with the permission of court orders before the debtors knew what hit them.

The lawsuit asserts that consumers were never properly notified and were not given a chance to defend themselves in court; creditors won default judgments. The total amount of money seized exceeded $500 million, according to the attorney general’s office.

“Our legal system is defined by due process and the guarantee that every New Yorker will get the chance to defend him or herself in court,” Andrew M. Cuomo, the attorney general, said in a statement. Not providing notice of legal proceedings, “undermined the foundation of this system.”

That’s one way to potentially get rid of debt — have your collectors skip a few legal steps and take your money illegally.

N.Y. Claims Collectors of Debt Used Fraud [The New York Times]
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