CFPB Sues Ohio Law Firm for Illegal Debt Collection Practices

The Consumer Financial Protection Bureau filed a lawsuit April 17, 2017 against Ohio law firm Weltman Weinberg & Reis Co., LPA for allegedly engaging in illegal debt collection practices in violation of the Fair Debt Collection Practices Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act. The case is Consumer Financial Protection Bureau v Weltman Weinberg & Reis Co, LPA, case number 1:17-cv-00817, in the U.S. District Court for the Northern District of Ohio.

The CFPB alleged that Weltman sent collection letters and made phone calls falsely implying that lawyers had reviewed a consumer’s account to determine that the debt was actually owed. The letters were sent on firm letterhead that included the phrase “ATTORNEYS AT LAW,” and included Weltman Weinberg & Reis on the signature line along with a detachable slip indicating that payments should be sent directly to the firm. The CFPB argued that these representations gave the false impression that the debt was being reviewed by an attorney, despite the vast majority being created through an automated process. According to CFPB director Richard Cordray, “Debt collectors who misrepresent that a lawyer was involved in reviewing a consumer’s account are implying a level of authority and professional judgement that is just not true.” The CFPB also alleged that this misrepresentation was occurring when Weltman identified itself as a law firm while making collection calls.

Weltman Weinberg & Reis disagree that any of their practices are in violation of the FDCPA or Dodd-Frank. Scott Weltman, the law firm’s managing partner, was quoted in a legal publication as saying that the lawsuit “is the result of our firm’s refusal to be strong-armed into a consent order.” “We are a law firm that is legally allowed, under federal and state law, to provide collection and legal services,” Weltman said in a press release. “We are being truthful with consumers and factually accurate when we use our name and our company’s letterhead for proper debt collection activity.”

The National Creditors Bar Association (“NARCA”) has issued the following statement regarding the CFPB’s lawsuit against the Weltman firm: “The absence of clear rules by the Bureau that align with state bar and judiciary requirements creates inherent conflicts between what we are required to do as attorneys and what the CFPB believes the rules should be. Regulation of the practice of law through enforcement activities ineffectively addresses the improvement of communications between consumers and attorneys”.

At Messer Strickler, Ltd. we agree that the CFPB’s practice of rulemaking through litigation is unreasonable and unfair.  We commend the Weltman firm for taking a stand and defending their collection practices.  Contact Joe Messer with any questions or comments.