New York's Attorney General and the CFPB have filed proposed settlements with debt collectors Douglas MacKinnon and Mark Gray; and their companies, Northern Resolution Group; LLC, Enhanced Acquisitions, LLC; Delray Capital, LLC.

Under the proposed settlement with MacKinnon, Northern Resolution Group, and Enhanced Acquisitions, they will be banned from the industry and must pay $60 million.

Under the proposed settlement with Delray Capital and Gray, they will be banned from the industry and a judgment for civil money penalties and redress will be entered against them.

insideARM has previously written about MacKinnon and Gray over several articles:

Per a CFPB press release,

"The Bureau and the New York Attorney General alleged that Northern Resolution Group and Enhanced Acquisitions are debt collection companies created and operated by Douglas MacKinnon, and that Delray Capital is a debt collection company created and operated by MacKinnon with Gray. The complaint alleged that since at least 2009, the companies together purchased millions of dollars’ worth of consumer debt, inflated those consumer debts, and relied on illegal tactics to extract as much money as possible from consumers for their debts. MacKinnon also set up a network of at least 60 additional debt collection firms to collect on the debt owned or placed by Northern Resolution Group, Enhanced Acquisitions, and Delray Capital. The Bureau and the New York Attorney General alleged that MacKinnon, Gray, and their network of debt collection companies misrepresented to consumers that they owed sums they did not owe, were not obligated to pay, or that the companies did not have a legal right to collect; falsely threatened consumers with legal action that the collectors had no intention of taking; and impersonated law enforcement officials, government agencies, and court officers."

Under the terms of the proposed settlement with MacKinnon, Northern Resolution Group, and Enhanced Acquisitions, those defendants also would pay $40 million in redress to consumers and a $10 million civil money penalty to both the Bureau and New York, for a total penalty of $20 million.

  • The joint stipulation for entry of proposed stipulated final judgment and order for MacKinnon, Northern Resolution Group, and Enhanced Acquisitions can be found here.
  • The stipulated final judgment and order for MacKinnon, Northern Resolution Group, and Enhanced Acquisitions can be found here.
  • The joint stipulation for entry of proposed stipulated final judgment and order for Gray and Delray Capital can be found here.
  • The stipulated final judgment and order for Gray and Delray Capital can be found here.

insideARM Perspective

If the allegations in the complaint are true, the CFPB is making the right decision, both in the amount of the settlement it's enforcing, and also in banning bad actors from the industry entirely for their fraudulent and harmful behavior. Bad faith players do nothing to foster a culture of compliance within the industry. In fact, one could argue that bad actors are not part of the industry, but instead exploit it for personal gain -- and, in some cases, for quite some time -- before finally being caught.

The four orders included by the CFPB in their statement about the settlement would definitely be worth reading as a gap analysis in your own policies and procedures.


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