PhotoSyndicated Office Systems is being ordered by the Consumer Financial Protection Bureau (CFPB) to provide over $5.4 million in relief to harmed consumers, correct its business practices, and pay a $500,000 penalty for causing consumers “distress and confusion.”


“Syndicated Office Systems mistreated consumers and prevented them from exercising critical debt collection rights,” said CFPB Director Richard Cordray. “These violations are particularly egregious given the challenges many consumers already face who are attempting to navigate the medical debt maze.”


High consumer impact


The company, which does business as Central Financial Control, is a debt collection agency that primarily collects medical debt on behalf of hospitals, doctors and other healthcare providers. It's an indirect subsidiary of Conifer Health Solutions, which provides billing and other services to more than 600 hospitals nationwide.


Tenet Healthcare Corporation, a publicly traded healthcare services company based in Dallas, Texas, is the parent company of Conifer Health Solutions.


Companies that collect medical debt and supply this information to credit reporting agencies have a significant impact on consumers’ credit scores. More than 43 million consumers have medical debt adversely affecting their credit reports, and more than half of all overdue debt on consumer credit reports is from medical debt.


A recent CFPB report found that the complex processes by which medical bills are incurred, collected by a wide range of debt collectors, and reported to credit reporting agencies can create unique challenges for consumers. The agency also found that medical debt can overly penalize consumer credit scores.


A CFPB investigation revealed that Syndicated Office Systems failed to send debt validation notices to thousands of consumers. It also found that the company mishandled consumer credit reporting disputes by failing to investigate and respond to consumers within the 30-day timeframe required under the law. Because the company furnishes information related to past-due medical debt, the information consumers seek to dispute or validate has the potential to lower credit scores.


The CFPB order charges the company with violating the Fair Debt Collection Practices Act and the Fair Credit Reporting Act. The violations specifically include:

  • Mishandling consumer credit reporting disputes
  • Preventing consumers from exercising important debt collection rights

Together, these violations had the potential to harm thousands of consumers and in some cases, negatively impact their credit scores, the CFPB said, which can hinder consumers’ ability to obtain credit or increase the rates they may pay for credit.


In some cases, the company reported inaccurate information to the credit reporting agencies and then failed to provide a timely response to consumer disputes about the errors. Some consumers may also have been able to avoid negative information on their credit reports if they had known about their right to assess and dispute the debt in question.


Enforcement action


To address these violations, the CFPB consent order requires Syndicated Office Systems to take the following actions:

  • Provide over $5 million in relief to harmed consumers
  • End illegal credit reporting and debt collection practices
  • Establish consumer safeguards
  • Pay a civil monetary penalty of $500,000



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