Alabama Consumer Law Blog

Our friend Denise Richardson has a guest post on her blog providing insight into the credit card industry. The source, and author of the blog post, is Scott Taylor, who was in the industry for 20 years.

Taylor feels that credit cards can be very useful when used properly, but the average consumer doesn't have enough education about how the credit card industry works. Banks know that most people will only pay the minimum monthly payment, and will use high interest to gain profit.He uses the example this example:

If you have a balance of $5000 with the average interest rate at 13.89% and a monthly payment of $150- If you NEVER used the card again and made every payment on time and constant amount, it would take you a short 3.5 years to pay that balance off..

Here is an insider tip, if your credit card company charges you a fee to pay your account online- you need to fire that company immediately. They are gouging you for fees that are absolutely not necessary.

He also warns of the dangers of "re-pricing." Taylor says that companies will alter interest rates of nearly everyone every year. If you have debt with another creditor, delinquent payments, or have had identity changes you're interest rate will very likely go up.

If you have had any problems with credit card companies, feel free to contact us.

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The San Fransisco Gate has posted an article, written by John Diaz, about the banking industry's attempt to alter a law dealing with customer privacy.

In California in 2004 a law was passed saying that the customer's permission had to be granted before their personal financial information, such as credit card activity, could have been sold or shared. However, the industry, now barely afloat courtesy of taxpayers, is lobbying for the law to be totally overturned. In 2005 the US Court of Appeals in San Fransisco altered the law to say that portions of the customer's information could be given out, but only information that would lead to deciphering insurance, employment, or credit.

The banking industry, according to this article, is seeking to overturn the California law and instead pushing for a federal standard on this issue, rather than have 50 differing state laws. However, this does leave one to wonder if the regulations protecting our privacy will be changed.

You do have to admire the audacity of the banking industry to beg the government for our money to stay afloat and then to say that California's standards which are designed to protect consumers (remember us - the ones bailing these banks out!) are intrusive on the rights of banks. It is one thing to be arrogant when everything is going right - but the banking industry teaches us that it is possible to be obnoxiously arrogant even when they have done their best to trash our economy. Let's hope this attack by the banking industry fails. We'll keep you posted as we learn more about this.

If you have had problems with your personal information being shared without consent, feel free to contact us.

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We are filing more and more lawsuits against collection agencies, debt collectors, and debt buyers for leaving illegal messages on our clients' answering machines and voicemail systems. There is a great need for more information as so many Alabama consumers are having to deal with these illegal voicemails so we wrote a short article for you which we hope will be helpful.

This article discusses the three types of common illegal voicemails - threats/lies; third party disclosures; and failure to leave the mini-miranda.

We also have prepared a free report on this subject which covers it in more detail. The report is entitled "How To Make Debt Collectors Pay For Leaving Illegal Voicemails" and is being made available for Alabama consumers who are not connected with or employed by any type of debt collection company. Simply fill out the form below to learn more about this growing problem and how the law, particularly the Fair Debt Collection Practices Act, makes it possible for you to fight back against the debt collectors who so routinely break the law.

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For about 8 months we have been publishing our newsletter, Consumer Connections, and our clients have found it to be filled with useful content. We have addressed timely articles such as illegal voicemails, illegal third party contacts, dirty tricks of insurance companies, and other articles that we think you will find valuable.

You are welcome to subscribe to it by either filling out a contact sheet on our website or filling out the form below. Make sure you include your address and email. We look forward to including you in our regular communications.

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Thttp://www.alabamaconsumerlawblog.com/2009/03/georgia_law_firm_under_investi_1.htmlhe Atlanta Journal-Constitution has posted an article about problems with a debt collection firm in Georgia. Alison Young, who wrote this fascinating article, says that consumers have complained of the firm using "deceit and abusive tactics" to collect their money...and in some cases money isn't even owed.

Enough people complained that, in Fall 2008, the Georgia Governor’s Office of Consumer Affairs launched an investigation into the matter. The article says that the investigation ordered the offending firm, Frederick J. Hanna & Associates, to

answer questions about collection practices, consumer disputes and what it does to ensure the validity of debts.

If you have had trouble with an abusive debt collector, or one you feel is using questionable tactics, please feel free to contact us.

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Business Week posted an article bringing attention to the decision of some cities and states to enlist private debt collectors to track down and collect "fines", such as speeding tickets and library fines. Jessica Silver-Greenberg and Peter Carbonara, authors of the article, say the idea behind this is to cut costs by having private collectors collecting these unpaid fees rather than government employees.

The idea is that private collectors would have more resources (and possibly time) to collect fines that a government employee wouldn't be likely to pursue, like a library fine. However, private collectors are often less effective. In March the IRS ended a four year contract with private debt collectors and instead hired 1,000 employees at the agency.

Some agencies using private debt collectors haven't been well received.

Not only are private debt collectors less effective than public ones, but a number of companies benefiting from the privatization trend have been slammed by regulators and prosecutors for overcharging municipalities, bribing public officials, and other predatory behavior. Some municipalities have stopped outsourcing their debt collection efforts altogether.

If you have questions or have had problems with a debt collector, feel free to contact us.

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We found there was a need to explain why we suggest you use a collection log and how to use the collection log. Therefore, we wrote an article that we trust will be helpful to you as you deal with collection agencies or debt buyers. Please take a moment and read this article and make sure you take advantage of the free collection communication logs so you can accurately track the communications you receive from debt collectors, particularly collectors that break the law.

Please let us know what questions you have that we can help answer.

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We are often asked by consumers about secretly recording phone calls with abusive debt collectors. Our answer often surprises consumers as we normally say "No". If you would like to find out why, please read our new article entitled "Two Reasons Why We Recommend You Not Record Calls In Alabama".

Please contact us if you have any questions about dealing with abusive debt collectors.

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U.S. Senator Charles E. Schumer (D-NY) has urged a federal investigation to look "into debt collection companies that pursue payments from relatives of deceased debtors, saying the practice appears to violate existing law." Schumer argues that debt collectors who harass a deceased person's family members should be required to state they (the family members) have no obligation to pay the debt unless they were a co-signer.
Senator Schumer wrote a letter to Chairman Leibowitz where he discusses why he feels this tactic is wrong should not be allowed to continue:

"To say the least, this practice is distasteful and unethical. Moreover, this practice may very well violate the Fair Debt Collection Practices Act. I am hereby requesting that the Federal Trade Commission investigate whether debt collection companies are violating the law when they engage in this practice, and exactly what information they are conveying to surviving relatives who are under no obligation to pay off their loved ones’ credit cards."

"I find it shocking that a debt collection company would determine that it is worth causing profound anguish and embarrassment in order to collect debts that are sometimes as low as $50, or which result in a payment of $15 a month from a widow or widower who is struggling to make ends meet. If a debt is large enough to be worth collecting, there are legal ways to obtain payment."

Schumer calls for an investigation into the following:

"Which debt collection companies (“collectors”) are engaging in the practice of collecting credit card debt from widows, widowers, children, and other relatives of the deceased?"

"Which credit card issuers are hiring these collectors, or selling their debts to these collectors? Have the issuers endorsed this practice, either by turning a blind eye toward it or by specifically encouraging it?"

"Does the practice of trying to collect unsecured debts from the living relatives of debtors who have passed on violate the Fair Debt Collection Practices Act’s prohibition on communicating with third parties? If not, why not? What measures could be taken to make sure that these practices are stopped?"

"If these practices are currently legal, are these collectors uniformly making sure that they tell living relatives that they have no legal obligation to pay the debt? Further, are the collectors informing the living relatives of the statute of limitations for collecting these debts? Are the collectors informing the living relatives that any credit card debt would be paid from the estate only after other secured debts, such as mortgage and car payments, are paid?"

If you have been contacted by a debt collector following the loss of a loved one and have questions, feel free to contact us.

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The California Lemon Law Blog posted an article about the increasing risks associated with used car dealerships.

Howard D. Silver says that identity theft, corruption, and fraud were uncovered in a recently concluded investigation of the January 2007 shooting of a New York used car salesman. This particular lot was allowing people to purchase vehicles without using their own name.

The invetigation also uncovered:

"...filing false information with lending companies in order to obtain financing, failing to credit customer deposits, switching loan interest rates, adding unreasonable fees and extra costs and insisting on extra insurance and warranties in order to inflate prices as much as possible."

While this particular case was in New York, it does happen all over the country. If you have been wronged by a used car dealership in similar ways, feel free to contact us.

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Filing the lawsuit is the first step in an Alabama Fair Debt Collection Practices Act (FDCPA) case against an abusive debt collector. Some lawyers like to negotiate with debt collectors before they sue but (with one exception) we do not do this as we are dealing with abusive collection agencies and debt buyers. These types of companies will often sue the lawyers and clients in the collector's home state if you send them a demand letter. We learned that the best demand letter is a federal lawsuit delivered to the collector.

The lawsuit will lay out the facts of what the collector did and how this violates the law. We don't have to plead or put every detail into the lawsuit but we do want to provide at least a broad outline of what the collector did wrong.

We normally sue for violations of the FDCPA. These types of violations can include third party disclosures or threats of criminal charges or lying or a host of other improper collector conduct.

We sometimes sue for negligent or reckless hiring or supervision of incompetent debt collectors. The type of collectors we sue are absolutely dishonest or incompetent if they did what our clients accuse them of doing and if that is true, and we believe it is, then the collection agency or debt buyer did a lousy job of hiring or supervising or training these dishonest or incompetent collectors.

We also sometimes sue for invasion of privacy. Particularly where debt collectors illegally contact third parties, this is a clear violation of our client's right to privacy.

In federal court we pay the filing fee of $350 and the cost of service which leads to the next post on serving the lawsuit.

If you have any questions about filing an Alabama FDCPA case or if you would like to discuss your experience with an abusive debt collector, please contact us for a consultation.

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Here is an intriguing story about a reporter using twitter to report on a trial in federal court.

What do you think of this?

My concern was about jurors reading this but here is the judge's response:

A couple of lawyers voiced concern about the possibility that a juror might visit the online site to read the posts from Ron Sylvester, a reporter for the Wichita Eagle, but U.S. District Judge J. Thomas Marten said jurors are always told to avoid newspaper, broadcast and online reports.

"You either trust your jurors to live with the admonishment, or you don't," he said.

I'm still figuring out Twitter but you are welcome to follow me if you would like by clicking here.

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The Consumer Law and Policy Blog has posted an article dealing with an increase in foreclosure related problems.

The article says that... "while foreclosure filings have not increased, every other category, including total loans in foreclosure and total loans more than 90 days past due, increased and continues to set new records. In case anyone had any doubts, subrime adjustable-rate mortgages are a failed product. A whopping 48% of these mortgages nationwide are delinquent or in foreclosure."

If you are facing foreclosure and have questions or concerns, feel free to contact us.

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The California Credit Law Blog has a recent post about how Experian will no longer make its FICO score available to the public. You can still access your credit report from Experian (and Trans Union,Equifax and Innovis) for free every twelve months and it is the credit report that provides the data that FICO uses to create your score. So pull your reports, make sure they are correct, dispute any inaccuracies, and if the errors are not corrected, consider filing suit against the responsible parties.

If you live in Alabama and are dealing with false information on your credit reports, contact us for more information about your rights.

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John W. Sharbrough, of the Alabama Consumer Law Blog, posted an article relating to American Express' attempt to bribe clients to pay off their debt.

The company is offering customers as much as $300 to pay off their balance and and close their card. However, the article warns that this is an attempt to "subvert bankruptcy laws."

“What AmEx is trying to do is move to the front of the line in terms of getting paid back by customers who owe debts to multiple lenders", said Micheal Talano, an analyst at Sander O’Neill & Partners. “They clearly grew loans faster than their competitors in the years leading up to this financial crisis.”

Ironcially, American Express just recieved $3.39 billion "from the U.S. Treasury to boost its capita....But apparently it had no intention to use that money to increase lending" according to Sharbrough.

If you are dealing with this, or any other issues relating to bankruptcy or debt collection/credit card troubles, feel free to contact us.

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Given the increase in foreclosures in Alabama (and nationwide), we are often asked if we can file suit against the mortgage companies for foreclosing on our clients. The answer is "it depends - what did the mortgage company do wrong?"

The simplest type of case (not simple to litigate but the cleanest) is when a mortgage company simply does not credit the payments it has received. Then the mortgage company says you are behind on your payments and ultimately forecloses.

This seems so obvious that surely no mortgage company would do this. While it is obvious, it happens. So what do you need to do if this happens?

1. Get the proof that your payments were sent in and accepted. Show the check where it was deposited. Show the proof of your online payments. You must show without any doubt that the payments were made and accepted.

2. Show where you disputed or told the mortgage company that it was wrong and that you had disputed its claim that you are behind.

There are other things to do but those are two of the first things we insist on new clients showing us before we can go any further into looking at their potential wrongful foreclosure case.

One other thing to keep in mind - if the mortgage company claims you are behind (when you are not) or has actually foreclosed on you it is critical to pull your credit reports. Almost always you will have false information on your credit reports that needs to be disputed. If it remains, this can give you a federal claim under the Fair Credit Reporting Act (FCRA) which entitles you to recover damages and attorney fees.

We will write more about other types of wrongful foreclosure situations but we wanted to start with this simple concept that is surprisingly common - payments are made and accepted but not credited.

If you live in Alabama and would like to meet with us or would like us to send you further information, please contact us today.

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CNN.com posted an article, written by Drew Griffin and David Fitzpatrick, highlighting a particular organization that works with prosecutors' offices to collect fees from bad checks.

However, the article says that when the American Corrective Counseling Services contacts individuals who have written bad checks, they often claim to be part of the attorney general's office...which they are not.

The ACCS was hired by the Florida county prosecutors' office to collect fees from bad checks, they are not a part of the prosecutors' office, as they would tell some people, such as Michael and Michelle O'Neil. The couple ended up paying $265 in fees for a bounced check of $14.

The ACCS "splits the money it collects with the prosecutor's office. But it also makes money from financial management courses that people who wrote the checks are required by law to attend at their own expense. And the company's contract with the prosecutor's office states those classes are its "principal business activity."

Lawsuits in three states have been filed in an attempt to stop the ACCS. "Deepak Gupta, the group's chief attorney in Washington, said companies like ACCS are effectively "renting out the prosecutor's seal" to collect money on cases prosecutors would not otherwise pursue."

The ACCS boasts that less than 2% of the people who take the required money management course repeat bouncing checks. However, people who have taken the course say they learned little to nothing they didn't already know.

The article says this is legally allowed, a bill was passed in 2006 that allowed contracts to be made between prosecutors' offices and debt collecting agencies, thinking it would be a more efficient way "to resolve bad-check cases ."

If you have are dealing with this agency and their tactics, feel free to contact us.

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On page two of the FTC Report, it begins to describe the "Debt Collection Process". First, often times creditors use "in house" or their own collection department to attempt to collect the debt. When this is unsuccessful, the creditor will charge off the account and send it to a third party collector. This can be a collection agency or a collection law firm.

Another option is to sell the debt to a debt buyer. The report contains this interesting and short summary of what debt buyers do with debts they buy:

(1) retains the entire porfolio and collects on it;
(2) retains and collects on part of the portfolio and reselss the remaining accounts: or
(3) resells the entire portfolio.

Debt buyers that keep accounts will either collect them in house (for example Midland Funding often does this) or will assign them out to collectors (LVNV does this).

Here are some interesting facts about the collection process from the report:

1. "Debt buyers usually pay five percent or less of the amount owed on delinquent accounts they purchase."
2. "If the contingency agency [collection agency] is successful in collecting on the debts, it will be paid a portion of the amount collected, with the average contingent fee rate in 2005 reported to be 28%."
3. "Collection law firms generally are paid either on an hourly basis or on a contingent fee basis."
4. "Rather than being paid contingency fees or hourly fees, some collection law firms also purchase debts and derive revenue from collections through judicial [lawsuits] or non-judicial [collection or arbitration] processes."

In our first post in this series, we looked at the purpose of the report and in our second post we looked at the overall summary of what the FTC proposed and what it found as areas in the law that needed to be changed. In our next post we will discuss the "Legal Framework" of debt collection - that is the laws that apply, particularly the federal laws that govern debt collectors.

Remember if you are dealing with an abusive debt collector, educate yourself and if you live in Alabama, contact us for a free consultation.

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The current economic state has pushed some debt collectors to “go over the line.” CNN posted an article on the “rogue” debt collectors and how to fight them, should you be on the receiving end.
The Fair Debt Collection Practices Act mandates that debt collectors to treat their clients with a measure of respect, including such things as not calling before 8am and after 9pm and prohibiting profane or offensive language.

If you live in Alabama and are dealing with a rogue debt collector who goes over the line, please feel free to contact us for assistance, as we sue abusive debt collectors.

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Recently a well known lawyer (Evan R. Chesler) wrote a piece in Forbes about why the billable hour method of billing clients should be killed. We agree.

Here is an excerpt from this interesting article:

The billable hour makes no sense, not even for lawyers. If you are successful and win a case early on, you put yourself out of work. If you get bogged down in a land war in Asia, you make more money. That is frankly nuts.

Our primary practice is representing consumers in consumer litigation and injured victims in personal injury cases. We do not bill by the hour. We use either a straight contingency or a combination of flat fee and contingency rate. We also defend consumers who are being sued by debt buyers. Generally we offer our clients an hourly rate approach but we prefer (and almost all clients prefer) a flat fee rate for either the entire litigation or for certain phases of the litigation.

Billing by the hour is ingrained in many lawyers' minds and in the eyes of clients but it seems this is shifting to other alternatives. If you are hiring a lawyer, consider options in addition to the billable hour rate.

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This continues our series on reviewing and summarizing the FTC Report issued last month about changes needed to the Fair Debt Collection Practices Act (FDCPA). In our first post we addressed the purpose of the report and in this post we will look at the Executive Summary of the report that deals with the five conclusions and proposals of the FTC.

Here is the ultimate conclusion of the Federal Trade Commission - "the debt collection legal system needs to be reformed and modernized to reflect changes in consumer debt, the debt collection industry, and technology."

There are five basic conclusions and proposals as follows:

1. "Major problems exist in the flow of information within the debt collection system." The FTC proposes and concludes that debt collectors (collection agencies, collection lawyers, and debt buyers) must have better information so that they will only collect from the correct people and only collect the correct amounts. The commission also found that debt collectors must do a better job of educating consumers of their rights under the FDCPA. Unless we know our rights under the law, we are at a serious disadvantage and are vulnerable to falling prey to abusive debt collectors.

2. "Debt collection laws need to be modernized to take account of changes in technology." It makes sense that debt collectors should be able to contact consumers through a variety of means as long as the collectors don't cost consumers by contacting them (i.e. text messages, cell phone calls, etc) and payments should be allowed through newer technology as long as the debt collector has "express verifiable consent from consumers before accessing their accounts."

3. "Certain debt collection litigation and arbitration practices appear to raise substantial consumer protection concerns." We see this widespread problem in Alabama where debt buyers are filing suits without any proof and showing up to court with no proof. Arbitration, particularly in the National Arbitration Forum (NAF) appears to be very unfair to Alabama consumers. The FTC stated it does not have enough information to make a decision but will be meeting with all concerned parties including state officials. We trust that the FTC will learn the extent of the epidemic of frivolous lawsuits filed by debt buyers.

4. "Debt collection law must evolve to include a regulatory process that ensures that legal requirements keep pace with changes in the marketplace." The FTC wants the ability to issue regulations to implement the FDCPA without having to wait for the entire congress to act. This makes sense.

5. "Debt collection law enforcement must be pursued aggressively to deter collectors from engaging in conduct that harms consumers." This is critical - the FTC writes "Private actions [consumer lawsuits], not FTC actions, were intended to be and should continue to be the main means of promoting industry compliance with the FDCPA." We agree - consumer lawsuits are the best and most efficient way of forcing collectors to comply with the law. One way to increase the effectiveness is to increase the statutory damage amount from $1000 to the equivalent amount in today's dollars, adjusted for inflation since 1977. A thousand bucks is not what it was in 1977.... The FTC also stated it will be more aggressive in suing abusive debt collectors which is an excellent idea.

We will continue this summary of this very important report released by the FTC on the FDCPA and the collection industry. Contact us if you have any questions or comments.

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The New York Bankruptcy Litigation Blog has posted an article about what debts remain unresolved should you file for bankruptcy.

Exceptions include child support, alimony payments, "certain cooperative housing fees", "debts brought about by intentional injury or property damage caused by the debtor" (this also includes personal injury debts caused by driving under the influence of drugs or alcohol), and any debt owed to a form of a government agency ( such as tax claims and penalties or fines).

If you are filing, or considering filing, for bankruptcy, feel free to contact us for assistance. We don't file bankruptcies but often times what causes a consumer to consider bankruptcy is dealing with abusive debt collectors which we can sue so sometimes this can be a better option that actually filing for bankruptcy.

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At the Debt Collection Lawyer Blog this advice is given to consumers who are dealing with the collection activities of a purchased debt (junk debt):

One of the most effective tacks to take as a debtor is to say, "yes, I may have had a debt with XYZ, but I don't know who in the world you are. If you can send me written documentation that you either own this debt now or are authorized to collect it, then I'll pay it." Immediately follow that verbal request up with a letter (ALWAYS certified mail, return receipt requested) asking for the same documentation. If the collector can't produce that record of ownership or authorization to collect, then they can't collect the debt. Often times, the collection agency or debt buyer has actually legally purchased the debt for real money. But that transaction is part of a complicated and lengthy legal document that they have absolutely no desire to share with you and to which a standard floor collector has no access. It may be simply easier for the collector to move on to the next more compliant debtor.

I'm not sure in this environment that this strategy will stop many collectors or debt buyers but its worth a try as it flows perfectly into one major strategy of defending a junk debt buyer lawsuit (Midland, LVNV, Asset Acceptance, Unifund, etc) filed by a local collection lawfirm (Zarzaur & Schwartz, Nathan & Nathan, Nadler & Associates, etc) - make the debt buyer prove it owns the debt.

Feel free to contact us for more information if you are sued in Alabama by a debt buyer.

(The Debt Collection Lawyer Blog is a good resource from a former debt collection lawyer - we appreciate the good posts and information there).

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Four title companies, all owned by Stephen Colson, are being sued. The companies, which include Prestige Title of Alabama, are being sued and this inhibits homeowners from refinancing their homes, and in some cases, leaves people wondering if they actually own their homes.
The article , written by April M. Havens, gives two different groups as victims. One being Donna and David Anderson, who are unsure if the house they helped their daughter buy is still theirs after Countrywide, the mortgage holder, returned the check to the title holder. $15,000 of renovations had already been put into the house. The article says the Andersons have filed an online claim with the title agency, but have had no response.
Another example is Nancy James, who thought refinancing her home would “be a simple way to consolidate loans and get a lower interest rate,” but instead was told she owed an additional $30,000 because the check from the title company to the mortgage company bounced.
Kenny Smith, the owner of four Coldwell Banker realty offices in Jackson County, says he has received about a dozen calls on this so far and advises people to hire an attorney. If you are dealing with this, or any other issues related to your mortgage, please feel free to contact us.

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Debt collection is a changing industry that is influenced by technological changes and changes in the method of debt being transferred - more and more it is by debt being sold to debt buyers. In October 2007 the FTC held a workshop to discuss these changes and how the law, particularly the Fair Debt Collection Practices Act (FDCPA), should be amended to keep up with the numerous changes since it was enacted in 1977.

After compiling the data and sifting through the arguments, the FTC released its report last month. This document is over a 100 pages long and is packed full of interesting information for consumers, consumer lawyers, collection agencies, debt buyers, and collection attorneys. We highly recommend you read this if you have any interest in the debt collection industry. In order to help, we will release a series of blog posts related to this report summarizing and providing our commentary on it.

We trust this will be helpful to you and look forward to this new series. Dealing with abusive debt collectors is a growing problem in Alabama and the best way to protect yourself is to educate yourself on your rights. If you have any questions about debt collectors or this report, please feel free to contact us.

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The Birmingham Bankruptcy Blog posted a video about the foreclosure procedure in Alabama. In Alabama, the mortgage company doesn’t necessarily have to file a foreclosure suit to begin the process of foreclosing on your house. All the lender has to do is publish a notice of foreclosure in a local newspaper (commonly the Alabama Messenger in the Birmingham area) for three consecutive weeks.
The lender isn’t obligated to send the homeowner a letter about foreclosure if the homeowner is behind on mortgage payments, however, commonly they will.

If you are facing foreclosure, or have questions about your standing, feel free to contact us.

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Denise Richardson has reported on the data breach at the University of Alabama:

University of Alabama campus officials sent letters out to 37,000 people whose personal information may have been stolen by computer hackers.

The school revealed Friday that in November, seventeen of their four-hundred databases were tapped by hackers. One of those computers contained lab results for people tested at the campus Medical Center. However, school officials say campus computer technicians quickly caught the hackers before they likely retrieved any confidential information.

Still, the school is suggesting people whose information was compromised check their credit records for any potential identity theft. A letter addressed to all of those with information on the servers were advised to place a fraud alert on their credit files and check bank accounts for unusual activity.

For more information on how to protect yourself if your data has been stolen read Denise's informative website here.

If you are a victim of Identity Theft, here are some additional steps you can take as well as contacting us for a free consultation on your rights.

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Our friends at Dean Malone's lawfirm in Texas took this deposition of an employee at the well known IC Systems regarding the number complaints that IC Systems receives per year and what changes in policies occur.

We hope you'll find this interesting, particularly if you are dealing with IC Systems as many Alabama consumers are....

If you have any questions about IC Systems or any other debt collector, please feel free to contact us.

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Congratulations to the Washington Attorney General, Rob McKenna, for suing Topco Financial, a debt collector for the following reason:

Representatives of Topco Financial Services, Inc., allegedly called debtors names such as “loser,” scum,” “plight on society,” “no good,” “lowlife,” “deadbeat,” “worthless,” or “terrible parents,” as well as profane names not suitable for print.

That kind of language isn’t just abusive – it’s illegal. It’s also the type of unfair business practice that can make it harder for legitimate collectors who play by the rules to do their job.

We see too many cases of abusive debt collectors. They often will do anything to make us emotional - angry, embarrassed, scared, etc. Using profanity or insulting words is all part of the plan. If you are facing one of these abusive debt collectors, keep your cool and contact an experienced consumer attorney who litigates these types of cases.

(By the way - regardless of where you live - subscribe to the Washington AG blog "All Consuming" as it is full of useful information).

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You go to the hospital for an approved procedure and expect for your insurance company to pay the bills and you pay the co-pay or deductible. But what about the doctor in the operating room that is "out of plan" or not a part of the Blue Cross Blue Shield plan? She may only be paid 50 cents on the dollar and guess who the doctor tries to stick the other 50% to? Yep. You. Welcome to the wild world of "balance billing".

Maria Perotin recently wrote an informative article about this practice which we recommend you read. Detailing one man's experience, Maria writes:

As Heidelberger remembers it, no one discussed his insurer’s network in 2007, when he underwent his medical procedure.

An anesthesiologist at the hospital spent a few minutes giving him a local anesthetic, he said.

Then, his physician tinkered successfully with a device that previously had been implanted in his heart.

Months later, the anesthesiologist’s bill arrived for $1,005.

That’s when Heidelberger discovered that the doctor didn’t have a contract with his PPO.

The anesthesiologist had set a fee of $2,020 for his services, and the insurer had paid only the amount it deemed fair for an out-of-network doctor — $1,015. So, the doctor turned to Heidelberger in October for the remainder of the bill.

Heidelberger has refused to pay.

He said he believes that the bill is too high and took too long to arrive.

And he contends that he should have been warned that the anesthesiologist was a costly out-of-network provider.

"My strong belief is this: If I take my car to a garage or you take your car to a garage, because the engine is acting peculiarly, the garage calls you and says: 'The engine's wrong. This is wrong. It'll cost you thus-and-such to repair it,' " Heidelberger said. "I think I should've been made aware of that and had the option to choose another anesthesiologist."

Be aware of this practice as these bills can quickly be turned over to collection agencies. It has been our position for years that contract law applies to medical bills. If the term of "price" is not agreed to ahead of time, then the law will supply a reasonable price term. If we want to know what is reasonable, we look to the "usual, customary, and reasonable" (UCR) that insurers such as BCBS set forth. We have always had hospitals and doctors back down when challenged as they may try and collect in balance billing or from an uninsured person two to three times what the UCR is which is not reasonable.

We'll keep an eye on developments in this area and keep you posted.

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I am sure some of our Alabama Consumers enjoyed the snow. I sure know my little boy, Sawyer, did. At four years old, he's already looking for the camera and ABC 33/40 was there to oblige. For those of you who don't know him, Sawyer is the little boy in the blue ski jacket talking about running into a tree in this video.

I hope you enjoyed the brief winter wonderland as much as he did.

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At the end of January we filed a federal lawsuit in Birmingham, Alabama against the debt buyer Midland Credit for refusing to stop reporting false information on our client's credit report. We also sued the consumer reporting agency of Equifax for participating in this wrongful reporting.

As we have seen repeated over and over in the courts of Alabama, Midland sues a consumer without any proof being offered at trial that the consumer owes Midland any money. The trial court tells Midland the consumer does not owe any money. The consumer then disputes the credit reporting after noticing that Midland is reporting on the consumer's credit reports. Amazingly, Midland tells Equifax to keep the false reporting.

We sued Midland for violating the Fair Debt Collection Practices Act (FDCPA), the Fair Credit Reporting Act (FCRA), and state law.

If you are dealing with Midland or other similar debt buyers, know your rights and take action immediately.

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We are making available a free report dealing with the five (5) secrets that debt buyers don't want you to know about when they sue you. When you know these five secrets, it can dramatically improve your chances of winning the collection case. As we have previously discussed, when you win your collection case, all sorts of good things happen - your credit report must be corrected, there is no judgment against you, no garnsishment against you, and you have a judge declaring that you do not owe the debt.

If you would like this report, contact us through our request form or call us at 205-879-2447. This free report will be mailed to you. Please note this is only available to Alabama consumers who do NOT work for collection agencies, collection lawfirms, or debt buyers.

Please note you can also request it directly by filling out the form below:

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