New York Attorney General Andrew M. Cuomo today announced criminal charges against an individual who allegedly ran a collection agency while incarcerated in federal prison on unrelated charges.
Lamont Cooper, 38, formerly of Lancaster, N.Y., operated CMC Recovery Services Inc., d/b/a Legal Action Recovery in Buffalo, N.Y., from prison in violation of a May 2009 court order barring him from the collection industry, according to the felony complaint. He was barred after an earlier investigation determined his business regularly used threats and intimidation against consumers.
The complaint alleges that Cooper’s collectors routinely pose as law enforcement and threaten to arrest consumers unless they make arrangements to pay the company immediately. The complaint further alleges Cooper’s involvement in the scheme continued after he was taken into federal custody in October 2009 for being found in violation of the terms of his release from a 1997 drug conviction.
An investigation by multiple law enforcement agencies included monitoring his correspondence while housed at a federal detention facility in Batavia, N.Y. The surveillance determined that Cooper remained actively involved in the collection business, including instructing employees on how to manage accounts and personnel matters, and requesting that he be kept abreast of “all banking activity.”
Cooper and CMC Recovery Services were charged in Buffalo City Court with Scheme to Defraud in the First Degree, a Class E felony that carries a maximum sentence of up to four years in prison. Cooper also was charged with Criminal Contempt in the Second Degree, a Class A misdemeanor that carries a penalty of up to one year in prison. CMC may be fined up to $10,000 or double the amount of the corporation’s gain.
According to information obtained during the civil investigation, Legal Action Recovery collectors regularly demanded payment for non-existent debts and debts that had passed the statute of limitations or were discharged in bankruptcy. Using false law enforcement identities, collectors coerced
individuals into agreeing to make payments. Many victims were asked to pay by credit or debit card, authorize withdrawals from their checking accounts or send money via Western Union.
Attempts today to reach Cooper's attorney for comment were not successful.
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