Performance Capital Management

In 2000, the Federal Trade Commission (FTC) filed a lawsuit against a California debt collector called Performance Capital Management (PCM). In this lawsuit against the debt collection agency, Performance Capital Management systematically reported collection accounts with delinquency dates that were more recent than the actual date of delinquency.

The lawsuit against Performance Capital Management

According to the complaint cited by the Federal Trade Commission in a lawsuit against Performance Capital Management, the CA debt collection agency reported more recent delinquency dates to the credit bureaus causing the negative information to remain on consumers' credit reports longer than they should be. The negative information remained on the credit reports long beyond the seven year period mandated by the FCRA.

The Federal Trade Commission's complaint also alleged that Performance Capital Management violated Section 623 by:

• ignoring or failing to investigate consumer disputes referred by credit bureaus and
• failing to notify credit bureaus when consumers disputed collection accounts with Performance Capital Management.

Outcome and result of the lawsuit against Performance Capital Management

The Federal Trade Commission charged that Performance Capital Management's practice of debt collection was inadequate. It was revealed that Performance Capital Management compared the name, address, and information in their computer database with the information provided on each consumer dispute verification form.

When the two match, Performance Capital Management reported that the information on file was verified and deemed accurate. Two things were wrong with Performance Capital Management's system and procedure:

• The actual records of the original creditor are not reviewed
• The matter was not referred to the original creditor for the original creditor to verify the accuracy of the information.

<< Previous    [1]  2    Next >>