Pennyslvania Seeks To Shut Down Debt Collector

An Erie, Pennsylvania debt collection company stands accused of using deceptive tactics to mislead, confuse or coerce consumers.

Pennsylvania Attorney General Tom Corbett, who has sued Unicredit America Inc., accuses the firm of using bogus "hearings" allegedly held in a company office that was decorated to look like a courtroom.

"This is an unconscionable attempt to use fake court proceedings to deceive, mislead or frighten consumers into making payments or surrendering valuables to Unicredit without following lawful procedures for debt collection," Corbett said. "Consumers also allegedly received dubious 'hearing notices' and letters - often hand-delivered by individuals who appear to be Sheriff Deputies - which implied they would be taken into custody by the Sheriff if they failed to appear at the phony court for 'hearings' or 'depositions'."

In recent months debt collectors, both real and fake, have increasingly used intimidation as a fear-inducing weapon against their victims. Some threaten victims with arrest at their place of employment, or at home in front of their children. Unicredit allegedly took this concept to new heights.

Cease and desist

Corbett said that in conjunction with the lawsuit, the Attorney General's Office has also filed a petition for special and preliminary injunction, asking the court to freeze all Unicredit assets; prohibit the company from engaging in any debt collection; immediately cease all bogus hearings or depositions; and to provide detailed information about company bank accounts, assets and business records.

According to the lawsuit, fictitious court proceedings were used to intimidate consumers into providing access to bank accounts, making immediate payments or surrendering vehicle titles and other assets - sometimes dispatching Unicredit employees to consumers' homes in order to retrieve documents or have consumers sign payment agreements.

Corbett said Unicredit allegedly used civil subpoenas to summon consumers to an office in Erie, which included an area referred to by Unicredit employees as "the courtroom." 

The fake courtroom allegedly contained furniture and decorations similar to those used in actual court offices, including a raised "bench" area where a judge would be seated; two tables and chairs in front of the "bench" for attorneys and defendants; a simulated witness stand; seating for spectators; and legal books on bookshelves. 

During some proceedings, an individual dressed in black was seated where observers would expect to see a judge.

Corbett said Unicredit is accused of violating Pennsylvania's Consumer Protection Law and the Fair Debt Collection Practices Act, and also failed to comply with state and Erie County court rules in order to extract payments from consumers.

Consumers should understand that there are very strict rules controlling what debt collectors can, and cannot do, in trying to collect a legitimate debt from consumers. The law establishing these consumer rights is the Fair Debt Collection Practices Act. The Federal Trade Commission has a helpful FAQ outlining your consumer rights.