Massachusetts law firm Lustig, Glaser & Wilson PC allegedly used unfair and deceptive practices to collect debts from hundreds of thousands of residents in the state in recent years, according to Massachusetts Attorney General Maura Healey in a complaint filed in Suffolk Superior Court.
The law firm has filed 100,000 lawsuits against Massachusetts residents and collected more than $110 million from them since 2011, taking advantage of many of the poorest people in the state, Healey alleged in court documents. In one case, the firm allegedly sought a civil arrest warrant against a 90-year-old woman, according to the Boston Globe, which reported on the lawsuit Wednesday.
The Waltham, Mass.-based firm used an automated system to identify potential court cases and often collected debts based on inaccurate or incomplete information, according to the complaint. The firm’s owners, Ronald E. Lustig and Kenneth C. Wilson, did not return calls for comment. Legal counsel for the firm indicated they are looking forward to being vindicated in court and have cooperated with Healey’s investigation.
Lustig, Glaser & Wilson is one of the largest debt collection litigators in Massachusetts.
The Massachusetts Division of Banks notified the firm in November that it must register and obtain a debt collector’s license and the firm, in turn, sued the banking commissioner in Suffolk Superior Court, arguing that the regulatory agency exceeded its authority and state law.
The court complaint contends that the law firm used spreadsheets providing scant details about payment histories, debt ownership and original contracts. Disputes over amounts owed also weren’t detailed. Soon after a data download, the firm would send demand letters and begin robocalls, according to the complaint.
Healey alleged that in one case the firm attempted to set up automatic debt payments from the bank account of a consumer whose sole source of income was $700 a month in disability benefits. The firm also often pushed consumers to pay even when their only income was from Social Security or veterans and unemployment benefits, all of which are exempted from debt collection, according to the lawsuit.
Lustig, Glaser & Wilson lawyers filed complaints in district courts when the consumers failed to pay and because many consumers didn’t show up to contest the complaints, the law firm won default judgments without having to provide proof.
Collection law firms that pursue collection cases have endured more scrutiny in recent years. The Consumer Financial Protection Bureau in July 2014 sued Atlanta-based Frederick J. Hanna & Associates, alleging that it operated as a debt mill, churning out 350,000 lawsuits against consumers who may not have owed any money. The law firm denied those claims.