The Massachusetts Attorney General’s Office (AG) will announce a $4 million settlement with Portfolio Recovery Associates (PRA) today, according to the Boston Globe. The AG’s investigation into PRA began after it received hundreds of complaints from consumers about the company.
The AG's office alleges that PRA violated consumer protection laws in its efforts to collect debts. Specifically, the AG alleges that PRA collected debts for which it did not have proper documentation to show that the debt was actually owed, the amount of debt owed, and ignored the statute of limitations for pursuing debt. Additionally, PRA allegedly collected exempt Social Security income from consumers.
As part of the settlement, according to the Boston Globe article, PRA agreed to:
- Not call consumers more than twice in a seven-day period;
- Stop credit reporting debts that it does not have proper documentation for;
- Stop collecting exempt income from consumers; and
- Ensure it has documentation to show that debts are valid prior to collection efforts.
insideARM reached out to PRA, which provided the following comment:
PRA has fully and voluntarily cooperated with the Attorney General and her office throughout this matter. While we deny that PRA’s practices violate Massachusetts or federal law, we have agreed to these terms in order to resolve this matter, avoiding both further cost and delay associated with legal action. Most importantly, we are pleased that we have reached agreement with the Attorney General regarding enhanced communication and disclosures with our customers.
insideARM also attempted to reach out to the Massachusetts AG’s office for comment but was unable to do so, likely due to the office being closed for Veterans Day.
The text of the settlement agreement has not been made public at the time of this article’s publication.