Maryland Regulators Suspend Licenses Of Two Agencies

Maryland regulators have suspended the collection licenses of LVNV Funding LLC and Resurgent Capital Services and ordered them to stop collecting from consumers in the state.

The state Department of Labor, Licensing and Regulation said Friday the companies violated several collection laws, including filing "false, deceptive or deficient affidavits" in court cases, misrepresenting the amount owed and collecting unauthorized attorney fees.

The companies combined have filed more than 27,000 cases in Maryland courts over the past six years to seek judgments on old debts, including defaulted credit card accounts.

LVNV, based in Greenville, S.C., in September settled a class-action lawsuit by agreeing to forgive about $10 million in debt it had tried to collect from 3,500 Maryland consumers (see story). A key part of the suit was that the company received its collection license after filing thousands of cases in the state. LVNV did not admit any wrongdoing.

Maryland's highest court voted in September to require more documentation from debt buyers as of Jan. 1, 2012.