CFPB and NY AG sue debt collector to seize transferred property

On April 22, the CFPB and the New York Attorney General filed a lawsuit against the owner of a now defunct debt collection company for allegedly transferring ownership of his $ 1.6 million home to his wife and daughter for $ 1 shortly after receiving a civil investigation. inquired and learned that the Bureau and the AG were investigating his debt collection activities. As previously covered by InfoBytes, the Bureau and the GA reached agreements in 2019 with the debt collection transaction to resolve allegations that the defendants established and operated a network of companies that harassed and / or tricked consumers into paying inflated debts or amounts they might not have. from. The terms of the settlements imposed civil monetary penalties and remedies for consumers and permanently prohibited defendants from acting as debt collectors. According to the complaint, the defendant owner did not pay anything to comply with the 2019 settlement, nor did it cooperate with the Bureau and the AG’s efforts to obtain relevant financial information. The complaint further asserts that the transfer of ownership was a fraudulent transfer under the Federal Debt Collection Procedures Act and made with intent to defraud (a violation of New Debtors and Creditors Act). York), and alleges that the defendant owner “deleted and concealed assets in an attempt to render the judgment obtained by the plaintiffs from the government irrecoverable.” Further, because the property would have been “transferred with the intention of hindering, delaying or defrauding a creditor”, the complaint argues that the defendant owner has “no right to claim an exemption from homestead” . The complaint asks the court to set aside the transfer of ownership and to authorize the seizure of the property. In addition, the Bureau and the GA request that the house be sold with all the products intended for the 2019 Defendant Owner’s Settlement, and seek a pecuniary judgment against the wife and daughter of the Defendant Owner for the value of the property in as assignees of the fraudulent transfer of ownership.

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