Debt collection firm resolves allegations of aggressive collection tactics for old debts – Finance and Banking

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United States: Debt collection firm resolves allegations of aggressive collection tactics for old debts

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  • Massachusetts AG Maura Healey reached a settlement with national debt collection company Transworld Systems, Inc. (“Transworld”) to resolve allegations that it used unfair and deceptive debt collection practices to service various debts, including student loans, in violation of Massachusetts consumer protection laws and the Massachusetts AG Debt Collection Regulations.
  • According to termination insurance, Transworld, which is the primary debt collector for private student loans on behalf of the National Collegiate Student Loan Trusts, has reportedly attempted to collect old prescribed debts using false and misleading affidavits against student borrowers and did not provided the notices of the rights of borrowers. In addition, Transworld reportedly contacted consumers at home and at their place of work more frequently than permitted by the Debt Collection Regulations.
  • Under assurances of the disclaimer, Transworld agreed to pay the Commonwealth $ 2.25 million and the money could be used to compensate consumers. Transworld has also agreed to end unreasonable attempts to contact consumers and to end improper collection procedures for prescribed debts, including by not producing false or misleading affidavits and providing consumers with the required information, among other things.

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