National Enterprise Systems, Inc. (“NES”) allegedly violated the Fair Debt Collection Practices Act (“FDCPA”) by threatening to sue without being able to or intending to sue, threatening to garnish non-borrower’s wages, repeatedly calling consumer’s relatives, threatening to have consumers arrested unless they paid their alleged debts, and using profanity according to consumers who filed FDCPA lawsuits.
Although the factual allegations in the Fair Debt Collection Practices Act lawsuits described in this article are just that — alleged facts which were never proven or disproven in court — many of the consumers’ complaints allege serious misconduct.
FALSE THREATS TO SUE CONSUMERS
A Florida consumer alleged that National Enterprise Systems left a message on her answering machine which stated :
“I am one of the facilitators here with NES and Associates. I am calling in regards to a file complaint that’s here in my office that is scheduled to be forwarded out today at 3 PM through Fort Lauderdale, FL. It is in your best interest to retun my call today before 3 PM in regards to the file complaint number FL, as in Florida, 41485642.”
False threats to sue a consumer violate the Fair Debt Collection Practices Act. If a collection agency threatens to sue a consumer without having : (1) the ability to sue; OR (2) the then-present intention to do so, violates the FDCPA. If the collection agency does not own the debt OR does not have lawyers licensed to practice law in the state where the consumer resides, the debt collector does not have the ability to sue. Even the very few debt collectors that actually have the ability to file suit seldom have a firm intention to sue a consumer.
The Florida consumer alleged that NES called her cell phone although she never gave NES or the original creditor express permission to call her cell phone. Unless the consumer granted the original creditor (or the debt collector) “express permission” to call their cell phone, collection agencies who use “automatic dialers” or leave prerecorded messages on consumer’s cellular telephones may have violated the consumer’s rights under the Telephone Consumer Protection Act.
PHONE MESSAGE “REGARDING A PENDING LEGAL ACTION”
A Minnesota consumer alleged that National Enterprise Systems’ debt collector left a phone message at her place of employment stating that NES was calling “regarding a pending legal action” and that the debt collector needed to speak with her immediately.
Obviously, this is yet another false threat to sue by a NES debt collector. Leaving no stone unturned, the Minnesota consumer’s highly experienced FDCPA lawyer alleged that NES’s message violated 15 U.S.C. Section 1692d, 1692d(2), 1692e, 1692e(2), 1692e(4), 1692e(5), 1692e(9), 1692e(10), 1692e(11), 1692f, and 1692f(1), “amongst others”.
IF YOU HANG UP, YOU WILL BE SUED IMMEDIATELY
A New York consumer alleged that National Enterprise Systems called consumer at the hospital where she works. Debt collectors who call employees at hospitals, emergency services, or transportation facilities just might have a “clue” that such calls might be inconvenient. NES’ employee told consumer that he would be sued immediately unless she agreed to pay NES during this phone call. Consumer informed NES that he was not able to speak while at his place of employment. NES’ employee replied that, if consumer hung up, he would be sued immediately. During this conversation, NES’ debt collector indicated that she had spoken to other employees at consumer’s place of employment. [Debt collectors frequently contact co-workers, neighbors, relatives and friends in an attempt to illegally coerce consumers into paying.]
NES’ employee demanded to know consumer’s cellular telephone number and the telephone numbers of consumer’s friends and relatives. NES then informed consumer that he needed to telephone his friends and relatives on another telephone line to attempt to have them pay the alleged debt. NES again reminded consumer that if he hung up the phone he would be immediately sued.
Eventually, consumer informed NES that he would like to discuss the account directly with Sallie Mae. NES’ debt collector told the consumer he was not permitted to speak to Sallie Mae and that his only opportunity to settle the alleged debt was right then over the phone with her.
After the consumer repeated that he was not allowed to receive NES’ calls at work, NES called him on his cellular telephone was still talking with NES’ collector on his employer’s land line. When the consumer asked the NES collector why she was calling his cell phone while she was speaking to him on his employer’s land line, NES’ debt collector responded that now that he was speaking to her on his cellular phone, the consumer was able to leave work and continue speaking to her on the cellular phone. NES’ debt collector demanded that he pay $ 5,900 right then and there or he would be sued immediately.
After the consumer finally got off the phone with NES, he contacted Sallie Mae to inquire about the status of the alleged debt. The consumer and Sallie Mae agreed to direct payment arrangements.
After the consumer and Sallie Mae agreed to payment terms, a person purporting to be a manager from NES telephoned the consumer demanding money. The consumer informed the NES “manager” that he had reached payment arrangements directly with Sallie Mae and had in fact paid Sallie Mae the required money. The consumer invited the “manager” to call Sallie Mae to confirm what he said and then demanded that NES stop calling him.
NES continued to call the consumer although the consumer paid Sallie Mae as directly agreed to.
When consumer demanded that NES stop calling him, NES’ debt collector said that NES would not comply with consumer’s request.
Although cease communication requests must be in writing in order to be actionable without additional facts, this case presents additional facts. The consumer told NES that he had called Sallie Mae, that the parties directly agreed to payment terms, and that the consumer was satisfying the agreement with Sallie Mae. A court may decide that debt collectors who continue to call the consumer under these circumstances do so with an intent to harass the consumer.
The debt collector’s statements that the consumer could not discuss the alleged debt directly with Sallie Mae are probably also false and deceptive and, in this case, sympathetic because the consumer disregarded NES’ false representations and contacted Sallie Mae to arrange payment terms.
“HOW WOULD YOUR PARENTS LIKE THAT?”
An Arizona consumer alleged that National Enterprise Systems called her about a Citibank-Sears account. According to the consumer, NES “advised her that she would have charges pressed against her and that the police would come to her door if she terminated the phone call and/or if she did not set up a payment arrangement with an account number that very same day.” NES’ debt collector “further advised that he could have the police sent to the [consumer's] house and serve her with papers and take her to jail.” NES’ debt collector then asked “How would your parents like that?”
Consumer asked NES’ debt collector to allow her to call her mother for a loan to pay NES the amount they demanded. NES advised consumer that she could not call back, that she had to pay or NES would have the police sent to her door.
Consumer told NES that she did not have any money and requested to make payments. NES’ debt collector told the consumer that they were beyond making payments and that she needed to pay the full amount. Eventually, NES and the consumer arranged for a payment on September 19 and made a conference call with consumer’s bank to authorize the withdrawal. NES’ debt collector warned consumer that if for any reason the payment did not go through that he would go ahead with the charges against her. I am not admitted to practice in Arizona but I suspect the debt collector’s threats to prosecute were groundless. They would be under Florida law especially considering the FDCPA’s protection of consumers who provide post dated checks or electronic access to their checking accounts.
Immediately after her conversation with NES ended, the consumer was in tears and contacted her mother about what just occurred. Consumer told her mother she did not know where she could get the money to pay NES.
Consumer’s mother called the NES debt collector. The debt collector told consumer’s mother that consumer could go to jail and that if the money was not available when agreed it would be a felony offense.
On Friday September 18, consumer called NES’ debt collector to tell him that she had closed the account and that she would not be paying NES. NES’ collector informed consumer that stopping the payment was a felony and that she would have to deal with the consequences.
Later that same day, consumer’s mother called NES’ employee. NES told her that stopping payment was a felony and described consumer’s conduct as malicious and dishonest. NES’ employee claimed that he had the court charges suspended based on consumer’ promise to pay. NES’ employee also stated that he would immediately file charges for passing a bad check over state lines. The debt collector told the consumer’s mother that he had done the consumer a favor by not sending in the police.
“YOU MUST NOT HAVE A VERY GOOD RELATIONSHIP WITH YOUR DAUGHTER”
A Michigan consumer (the borrower), her co-signor (her mother), and the consumer’s step-father (who was not obligated on the loan) alleged that National Enterprise Systems violated the Fair Debt Collection Practices Act and the Michigan Collection Practices Act while attempting to collect a private student loan. NES’ debt collector called the consumer’s father and told him that they were looking for the consumer’s cell phone and address to verify a job application. Obviously, the consumer had not applied to work at NES. NES’ debt collector called the co-signor’s house and told her son and asked for the consumer’s cell phone number and address again under the ruise of a pending job application and pending employment.
Soon thereafter, NES called the consumer and was very rude to her. NES’ debt collector referred to the consumer as an “idiot” for managing money in such a fashion for allowing her student loans to be in collection and ruing her mother’s credit score. NES’ debt collector false told consumer that her mother may never speak to her again.
Several days later, NES called consumer’s 81 year old grandfather at the nursing home where he resides.
NES employee called consumer’s step father and falsely told him that consumer “does not care about your wife’s credit score”. Although consumer’s step father was not obligated to pay the consumer’s educational loan, many of the provisions of the Fair Debt Collection Practices Act also protect people who do not allegedly owe the debt.
A week later, NES’ employee told consumer’s mother (who co-signed her loan) that she had to make a decision that day. NES’ employee recommended that the mother take money out of her retirement account to pay NES and was “very rude”. NES’ debt collector said to the consumer’s mother “You must not have a very good relationship with your daughter. She didn’t tell you what was going on? You must not get along very well.” Consumer’s mother replied “You’re talking down on me. I’m not going to put up with this. I need to speak with your manager.” NES transferred the call to a manager but the parties were unable to agree to payment terms.
NES’ harassment of the consumers was rewarded by consumer’s parent’s payments of $ 7,000 and $ 6,500 during the next two weeks. The harassment also sparked the FDCPA lawsuit 36 days after the events alleged in their complaint began.
FALSE THREATS TO SUE FRIGHTEN NORTH CAROLINA POSTAL WORKER INTO PAYING NES FOR SOMEONE ELSE’S DEBT
A North Carolina consumer alleged that National Enterprise Systems made a series of telephone calls to him and his mother attempting to collect a debt that was not even his. The consumer was the victim of an unauthorized bank draft the year before NES began calling so it appears that a thief had obtained much of his private financial information. The consumer alleged that NES contacted his mother prior to even speaking with him and told her that they needed to get in touch with her son right away or NES would sue him. During this conversation, NES asked her about her personal assets and her ability to pay her son’s alleged debt.
Later that day, NES spoke with the consumer who informed NES that the debt was not his. The consumer eventually obtained the credit card statements — none of which were sent to the consumer. The consumer believes that NES utilized “skip tracing” and “tagging” but had “no rational, objective basis to believe the alleged account actually belonged to [consumer].” The statements that the consumer eventually obtained from NES’s lawyers indicated that they were addressed to someone with the same first and last name at an address in Philadelphia, PA. Obviously, this is an address where the North Carolina consumer never lived. The credit card statements also showed charges made in, among other place, Dubai. The North Carolina consumer had never been to Dubai or even outside the United States. Finally, none of the statements showed charges that were made in North Carolina. When the consumer was receiving the calls, however, he did not have access to the statements because the account was never his.
Despite the consumer’s telling NES that the account was not his, NES told him that he had to pay them right away. NES informed the consumer that someone had filed a “Complaint” against him. NES also told the consumer that he had to have the money by 4:30 p.m. that very day.
The consumer grew highly agitated because of NES’ persistence, especially because the banks were going to close in less than two hours and the consumer did not know if he would have sufficient time to get NES the money. The consumer was extremely afraid of being sued and a sheriff coming to his house about the debt.
The consumer informed NES that he would rather deal with Chase Bank (the consumer’s alleged creditor). NES told the consumer that since Chase Bank had turned the account over to NES that he could not deal with Chase Bank anymore — he could deal only with NES.
NES repeatedly demanded that the consumer pay half ($ 7,500) of the amount of the debt ($15,000). The consumer repeatedly told NES that he did not have $ 7,500. NES instructed him to charge the remaining balance on his credit card. The consumer told NES that he had closed all of his credit card accounts when his identity was stolen the year before. NES told the consumer that he had one credit card account remaining open. (Apparently, NES pulled the consumer’s credit report and obtained his credit information.) The consumer found it impossible to hang up on NES because of the collector’s persistent demands that he pay one half of the alleged debt.
The consumer repeated his statement that he could not pay that much money in such a short amount of time. Eventually, the consumer paid NES $ 1,500 by a direct draft from his bank account.
For at least a solid week, the consumer’s mother’s “nerves were shot”. The consumer was deeply disturbed that his mother was involved and had gotten upset. The consumer desperately wanted the whole thing to end. The consumer borrowed money from his mother but the banks closed before he could transmit these additional funds to NES.
The next day, an NES employee called consumer’s mother demanding the rest of the money. The consumer’s mother was “all shook up” but collected her wits enough to tell the NES debt collector that the collector was nothing but a “scam artist”.
Later that day, a NES debt collector called the consumer while he was on the job at the United States Postal Service. The consumer’s coworkers heard his name summoned over the intercom and many of them overheard his conversation with NES. The consumer understandably felt embarassed and angry over this phone call. The FDCPA protects consumers from calls at work if the debt collector knows that the consumer’s employer has a policy against personal calls at work or that it is inconvenient to call the consumer at work. The complaint in this case does not allege sufficient facts to state a violation of 15 U.S.C. Section 1692c(a)(3) but the juzpah of a debt collector calling a frightened, unsophisticated postal worker at his place of employment in order to extort the remaining $ 6,000 is appalling.
The consumer eventually discovered that NES also charged his HSBC credit card $ 7,500 for the other half of the debt despite knowing that it wasn’t even his debt. The consumer was unaware that he ever opened the account or that he had activated the card.
The consumer experienced heightened anxiety every time he receives a bill from HSBC because he believes that if he does not pay the monies NES charged without his authorization, HSBC will start calling him and threatening him like NES.
The consumer sustained credit harm on his credit report as a result of the NES charge and was repeatedly denied credit. For example, the consumer attempted to obtain a personal loan from the bank to pay off the new debt to HSBC, but the bank turned him down because of the negative line of trade. The consumer was also unable to participate in the federal “cash for clunkers” program because his negative credit score incurred by the NES charges.
The North Carolina consumer was terrified by NES’ threats to sue. So terrified that he paid $ 7,500 towards a debt that he knew wasn’t even his. The consumer even borrowed $ 6,000 from his mother in order to pay NES.
Perhaps the North Carolina consumer might have made a wiser decision if he had known the following :
“A search of the records of the North Carolina Administrative Office of the Courts indicates that NES has never filed a lawsuit against a consumer in North Carolina.”
I have never observed NES filing a lawsuit against a consumer in Florida. Nor have I even heard of NES filing a lawsuit to collect a consumer debt in any other states either.
MISREPRESENTED THAT HUSBAND WAS RESPONSIBLE FOR WIFE’S ACCOUNT
A Pennsylvania consumer filed a lawsuit against National Enterprise Systems alleging that NES’ debt collector falsely told him that he was contractually obligated on his wife’s alleged consumer debt and that he had signed a contract for the alleged debt. The consumer alleged that neither of NES’ statements were true.
Potential liability for spousal debts is governed by state law. If a debt collector attempts to collect a spouse’s debt from a non-debtor spouse, the non-debtor spouse should consult with an experienced consumer rigths attorney before paying or agreeing to pay their spouse’s alleged debts.
FALSE THREAT TO GARNISH CONSUMER’S HUSBAND’S WAGES
A Richmond, Virginia consumer alleged that she received calls from National Enterprise Systems and spoke to several NES debt collectors in succession. The last NES debt collector coerced the consumer into agreeing to make a monthly payment by telling her that NES was going to garnish her husband’s wages if she did not pay $ 900 “Today”. The NES debt collector then said it had to be paid by the end of the week but subsequently changed this to by the end of the month. One of the NES debt collectors claimed to be an attorney. The final NES caller called her “disgraceful” among other things.
During a period of 18 days, NES called the Virginia consumer about 25 or more times, sometimes even 5 – 6 times a day. Debt collectors who call too often may violate the Fair Debt Collection Practices Act. Without more information, my guess is that 25 calls during a period of 18 days would probably not evidence an intent to harass or abuse the consumer. Much would depend upon the number of times that the debt collector spoke with the consumer. On the other hand, if a debt collector calls a consumer 5 – 6 times a day on the same telephone number (e.g., at home), it is reasonable to believe a jury might find the debt collector intended to harass the consumer. As this article demonstrates, however, there are often much more viable claims that “call frequency” despite the popularity of this topic on the “gripe sites”.
During these conversations the consumer disputed the amount of the debt and requested validation, but none was ever received. Consumers can dispute an alleged debt at any time and the dispute may be verbal. But, the mill that filed represented the consumer failed to allege that NES ever reported the account tradeline on the consumer’s credit report nonetheless allege that NES continued to report the account without also noting that the consumer disputed it. Nor is the consumer’s allegation that NES failed to validate the debt persuasive. The FDCPA allows consumers only thirty days from the receipt of the first validation notice to request debt validation and further requires consumers to make their validation request in writing.
NES told her that she had to get this money to avoid the garnishment of her husband’s wages. NES recommended that she borrow the money from family and friends.
THREAT TO ATTACH WAGES AND PROPERTY UNLESS PAID THAT DAY
An Ohio consumer alleged that National Enterprise Systems called his wife and told her that :
(1) he needed to pay the debt by 4:00 p.m. that day;
(2) if the debt was not paid by 4:00 p.m that day, NES would attach his wages and property; and
(3) wife could pay her husband’s debt to NES by credit card authorization over the phone.
Consumer’s wife panicked and called her husband. Consumer’s wife was so upset that he had to take the rest of the day off of work to console his wife.
The consumer’s lawsuit alleged that NES violated the FDCPA by, among other things : (1) engaging in conduct the natural consequence of which is to harass, oppress, and/or abuse the consumer [15 U.S.C.e Seciton 1692d]; and (2) using false, deceptive, and/or misleading representations or means in connection with the collection of any debt [15 U.S.C. Section 1692e].
WE’LL TELL YOUR EMPLOYER
A New Hampshire consumer alleged that National Enterprise Systems left voice mails on March 28, 2011 and March 29, 2011, stating that NES would immediately begin garnishing the consumer’s wages.
The consumer alleged that NES’ debt collector also threatened to inform his employer about the debt. When the consumer sued NES in July, 2011, NES had not taken action to garnish the consumer’s wages.
As a general rule, debt collectors may contact employers only in very limited circumstances and are restricted as to what they can say.
OUR LIPS AIN’T SEALED
A Pennsylvania consumer filed alleging that National Enterprise Systems called her place of employment and : (1) dislosed NES’ identity to her secretary; and (2) disclosed the existence of the alleged debt by telling her secretary that consumer “has some debts that she needs to talk about.”
The consumer’s lawsuit alleged that NES violated the Fair Debt Collection Practices Act by informing third parties of the nature of the consumer’s debt and stating that she owed a debt as prohibitted by 15 U.S.C. Section 1692b(2). The complaint also alleges that NES violated 15 U.S.C. Section 1692c(a)(3) by contacting consumer at her place of employment knowing that consumer’s employer prohibited such communications.
DOUBLE OR NOTHING?
A Virginia consumer alleged that National Enterprise Systems called her mother and disclosed that the caller was a debt collector and told her mother that her daughter (the consumer) was going to be sued.
The consumer called NES and spoke to an employee who said she owed $ 5,888.32 and that with all the late fees the debt could go as high as $ 9,000. (The original principal amount was $ 4,250). NES persuaded the consumer to agree to pay $ 2,888.49 to make a partial payment on the loan.
Soon thereafter, NES told the consumer that she had to pay another $ 2,888.49 only one week after she paid $ 2,888.32.
Thereafer, NES’ employee misrepresented to the consumer that she would be garnished unless she paid the $ 2,888.49 immediately. The consumer explained that she had spoken with Sallie Mae and that Sallie Mae told her that her account was in good standing. NES’ debt collector used abusive language and screamed at her that he would double the payment to $ 4,800, and that with all the late fees the debt could be as high as $ 9,000 if another payment was not made.
Soon thereafter, Sallie Mae sent the consumer a letter confirming that they received her most recent payment ($ 2,888) and that there was no past due amounts. Sallie Mae’s letter informed the consumer that the amount of her next payment would be $ 61.20. The consumer even held a conference call where Sallie Mae confirmed this information to NES.
Despite all of the information provided to NES, NES continued to call the consumer attempting to coerce payment.
NES’ debt collector called the consumer and told her that if she did not pay NES, NES was going to “double” the amount they said before and also threatened to sue the consumer. NES’ scare tactics worked.
The consumer’s husband withdrew money from his 401K retirement plan and, therefore, incurred tax penalties for doing so. The consumer reconsidered and decided not to pay NES any more money and did not send NES the money her husband withdrew from his retirement plan.
NES then tried to deduct funds directly from the consumer’s bank account!
The consumer alleged that, as a result of NES’ “scare tactics, the consumer “lost hair, could not sleep, and was dsitraught about the matter.”
Despite the aggregiousness of debt collectors’ demands for fictitious amounts allegedly due, debt collectors make such demands with surprisingly frequency.
“YOU JUST COST YOUR F***ING FAMILY $ 46,000″
A Pennsylvania consumer filed a lawsuit alleging that National Enterprise System harassed him after he wasn’t able to come up with money to pay NES. According to the FDCPA lawsuit, the consumer told NES that he expected to receive money that same day. The consumer provided NES his bank account information subject to the contingency of the consumer receiving the anticipated funds. Later that day, the consumer called NES to inform NES’s collector that he did not receive the funds and, therefore, could not make the payment. The complaint alleged that the collector became angry and began screaming at the consumer. The collector threatened to sue the consumer and falsely accused the consumer of using the money to buy groceries and vacations. The consumer wasn’t able to respond because NES’ collector was shouting at him. The collector’s final statement to the consumer was “You just costs your f***ing family $ 46,000″ immediately before the collector hung up on the consumer.
If proven true, the NES debt collector’s use of profane language would violate the Fair Debt Collection Practices Act.
“PLEASE HELP ME, I CAN’T TAKE THIS CONSTANT ABUSE AND HARASSMENT ANY MORE”
A Florida consumer sued National Enterprise Systems for allegedly calling his mother 2 or 3 times a day and telling consumer’s mother that he owed the alleged debt. The general rule under the FDCPA is that disclosing the existence of a debt to someone other than the consumer or the consumer’s spouse violates the FDCPA. In this case, the consumer also alleged that NES demanded that consumer’s mother pay her son’s alleged debt.
Attached to the complaint initiating son’s FDCPA lawsuit is a letter from his mother describing the harassment she experienced. The letter states :
“I would like to inform you that “NES” is constantly torturng me and my family with phone calls. They are calling for a third party, my son [consumer] whose alleged debt they are trying to collect and it has nothing to do with me.
On numerous occasions I told *** an NES representative and other callers that [my sone] does not live here. In response they keep asking me to pay his alleged debt. They call 2 – 3 times per day.
Please help me. I can not take this constant abuse and harassment any more.”
It should not surprise a debt collector that some of the consumers sue them for invading their privacy and harassing their parents. What surprises me is that more consumers do not sue debt collectors who commit such severe violations. Until enough consumers sue debt collectors for violations such as those NES allegedly committed, the debt collectors will continue to violate the law because it remains profitable for them to do so. Here’s where you can help not only yourself, but also help protect other consumers from future violations which might otherwise occur by standing up for your rights now.
BEING HARASSED? HAD ENOUGH?
If you are receiving calls from National Enterprise Systems, Inc. and are not sure about your rights, please feel free to contact me privately by completing the Collection Agency Harassment form in the right hand column of this page. If you live in Florida, you are also welcome to call my office and I will contact you to discuss your potential case and how I may be able to help you.
If you are receiving collection calls from National Enterprise Systems, Inc., you are welcome to share your “experience” with NES by commenting on this article.
(C) 2012 Donald E. Petersen
All rights reserved