New York Attorney General Andrew M. Cuomo filed a lawsuit against several Western New York collection companies for violating the Fair Debt Collection Practices Act and several New York state collection laws.

The suit claims that Frank Santiago of Hamburg, N.Y., the owner and operator of both Northern Asset Management LLC and Eastern Asset Management LLC, had employees use "abusive measures and lies in the debt collection operation." Employees allegedly harassed consumers through repeated
threatening and obscene phone calls and made illegal calls to the consumers’ employers and families.

The suit seeks to shut down the companies, bar Santiago from the collection business and require him to pay significant penalties, costs and fees to the state.

"There are clear laws that say how a debt collection company can do business, and we allege that this debt collector and his companies broke those laws. Threats, intimidation, obscene language and overt harassment are just some of the day-to-day business practices that were employed by this operation. Their actions must come to an end," according to a statement from Cuomo's office.

The investigation determined that Santiago tried to avoid detection from authorities by changing the name of his companies after consumer complaints mounted.

Santiago operated a company called Ethical Asset Management from late 2006 through mid-2007. After complaints, Santiago closed Ethical Asset and opened Eastern Asset.

After being sued dozens of times, Santiago shut down Eastern Asset in December 2009 and began operating Northern Asset, which is still active.

Earlier this month, in a related case, Cuomo sued Williamsville, N.Y.-based attorney John P. Nicolia after an investigation found he collected $141,000 in fees for allowing Santiago’s companies to threaten consumers across the country using Nicolia’s name. Nicolia never provided any actual legal services for the collection companies. See story for more information.

Santiago’s collectors, after invoking Nicolia’s name, often falsely stated that the consumers had lawsuits filed against them, would have their driver’s licenses suspended, would be charged with a crime and/or would be imprisoned or lose their property if they did not pay.

The collectors also repeatedly harassed consumers and their relatives. One consumer claimed that he received calls as early as 6:50 a.m. Others claimed the company called 10 to 15 times a day to their home, cell phone, work and even to family members over an extended period of time.

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