Collection agency to return $ 475,000 following lawsuit against WA AG

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A collection agency accused of illegally garnishing wages will return Washingtonians $ 475,000, the state attorney general’s office said on Tuesday.

The persons concerned will not have to contact the State to obtain this restitution. The attorney general’s office will mail the checks.

The money will be returned to up to 5,000 people, and hundreds more will have $ 250,000 in fees waived. The number of people affected has not been finalized, the GA’s office said.

Attorney General Bob Ferguson sued the agency, Machol & Johannes, in King County Superior Court last year. The lawsuit alleged the company violated consumer protection law and Washington’s collection agency law.

“Washingtonians who have debt have rights – debt collectors are not allowed to take every penny you have,” Ferguson said in a press release. “Debt collectors must obey the law. This resolution will make Washingtonians whole and ensure that Machol and Johannes abide by the rules. “

The attorney general’s office gave this account of what happened:

She filed a lawsuit after a King County Superior Court judge noticed the Colorado-based collection agency’s improper statements.

“Between 2015 and at least April 2019, Machol & Johannes broke garnishment law by engaging in a pattern or practice of submitting affidavits to Washington courts by falsely stating that the required proof of the shipment to the consumer was attached to the statement when it was not, ”the lawsuit said in part.

It also turned out that the agency did not have the proper license for over a year in 2011 and 2012, and charged people a fee when it did not fundraise – even though the fee are only allowed when a debt collector actually manages to collect the money.

In addition, the agency has not properly informed people that they can protect some of their funds from garnishment. Recent laws passed in Washington state allow consumers to exempt up to $ 2,000, half automatically and half by checking a box on a form collection agencies must provide.

The company is also required to return money collected from a Washington consumer who received a garnishment notice during the garnishment moratorium that was put into effect due to the COVID-pandemic emergency. 19, “the press release from the attorney general’s office said.

The consent decree that the parties signed on Monday to resolve the lawsuit states in part that the agreement “should in no way be construed as an admission of law, fact, liability or misconduct” and that the “defendants expressly deny any claims, allegations or causes of action which have been or could have been asserted by the State.

In addition to other compensation and repairs, the company will pay the attorney general’s office $ 414,000 for its investigation.

Alexis Krell covers local, state and federal court cases that affect Pierce County. She started covering the courts in 2016. Prior to that, she wrote about crime and breaking news for almost four years as a night reporter for the News Tribune.


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