Lawsuits – Guilty Until Proven Innocent

Guest Editorial

Like many in the recovery industry, I am second generation.  I remember running errands with my parents and trying to spot repos on the way to the grocery store at 9 years old.  Writing down license plates and attempting to learn and work in the family business, was a major part of my identity at such a young age.  I have proudly worked for Equitable Services for over 15 years, the business my father started 43 years ago. 

There is a status and responsibility that comes along with being in business for 43 years; an education, knowledge and wisdom that I dare say can be reckoned with. We have an executive management team that has been with us over 30 years.  Our agents, many of which are also 2nd generation themselves, have been with us for as many as 25 years.  We pride ourselves in our team and the guaranteed service we have been able to provide to our clients over the years because of them.

As many in the recovery industry have done, we have required our management team and field agents to become certified.  The regular training sessions we have for our employees and field agents continually educates them on the FDCPA, GLBA, NPPI etc.  All of this proactivity has led us to obtain the SSAE 16 Compliance Certificate.  Over the years, we’ve led many organizations through board appointments and still belong to great organizations like Time Finance Adjusters (TFA), American Recovery Association (ARA), National Finance Adjusters (NFA) and Allied Finance Adjusters.  As a licensed and insured agency, we dove in and played an instrumental role in assisting the Illinois Recovery Association in crafting revisions to SB1306, which later became the Collateral Recovery Act; with over 90% of our suggested revisions having been accepted by the Illinois State Government.  We will be ready for State licensing the moment the State is ready to enforce the new law.  We have jumped through every hoop to ensure that we are professionally represented, properly licensed and that our employees act within the boundaries of every regulation and law put in place; this is not a smoke and mirrors trick to make us look good.  We have worked very hard and spend thousands of dollars each year to ensure that we exceed any compliance measurements and have the ability to adapt to this rapidly changing industry.

A lawsuit that Equitable Services now faces flies in the face of all of this experience and illustrates how no company is immune to the frivolousness nature of our litigious society.  We have been sued by individuals who have accused our company and our field agent of actions which never happened.  The claim of action in this suit contains behavior that is obviously inconsistent with our company policy, and outside the realm of our agents professional demeanor.  The claims made in this suit are untrue.  Our agent did not act as alleged, and did not “exert control over the plaintiffs” in any way. In fact, it was our agent that called the police several times, in attempt to diffuse the situation that was being inflated by the plaintiffs.  A police report was never generated and there were no arrests made.

In a perfect world, the case would have never have been allowed to be filed against us without some credible support.  The allegations made against us are untrue and what we have been accused of, we did not do.  But this is not that perfect world, rather, it is one that, all of us in the recovery industry, must live and operate within.  Compliance, now on a state level with the Collateral Recovery Act and now increasingly on a Federal level with the founding of the CFPB, is the single largest component of success or failure in the recovery industry that will literally make or break our business and yours.  

Our almost 45 years of experience, and our proactive approach to compliance, afforded us the ability to illustrate to our client the lawsuit was frivolous.  Our reputation has remained intact and we did not lose the client due to this lawsuit largely in part because of our positive approach to compliance and documentation.  I am writing this editorial to illustrate that if you have been procrastinating putting policies in place, procrastinate no more.  Your professional reputations and businesses are on the line.  Without these policies, you are all at risk of phenomenal loss that you may not survive.  The future of your business rests on compliance.

Thank you,

Kelly McGivern, CARS, MPRS

Operations Manager

Equitable Services, Inc.

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13 thoughts on “Lawsuits – Guilty Until Proven Innocent

  1. Kelly really sums it up in her well written missive on the state of our industry at this time in history. I personally know that Kelly and Equitable Services are one of the most compliant and well trained agenceies in our industry. Kelly, as a charter member of Eagle Group XX, has received the most advanced compliance training in the industry to date, has submitted all of the alternate documents required regarding Privacy and Security, Emergency and Disaster Management and holds the credential of Mortgaged Property Recovery Specialist. But no matter how hard we strive, no matter how much training we have and give our employees we should always understand that in our litigous society we can only mitigate the risk, never remove it. We all have big targets painted on our back thanks to the “Reality Repo” television presentations. We will continue to see Reality mimic Fiction and can only hope that when the time comes we will be as prepared to defend our actions as well as Kelly and Equitable.

  2. It’s all a part of the redistribution of wealth in society. There is no personal accountablity. You mismanage your finances (no Virginia not every debtor has lost there job and is dying of cancer as the media portrays) then you have the ability in our society to sue the collection agent because you were damaged by the font size in a letter you received. You also sustained mental anguish that someone else knows you don’t manage your finances other than your creditors and it will take $50-$100k for therapy. Judges refuse to read and make a decision based on the FDCPA. They would rather stand on existing case law or send to a jury. Either way they don’t damage their reputation by losing on appeal and what they jury decides,well the jury decides……the latter is the reason why they NEVER dismiss frivolous lawsuits. Let the attorneys work and get paid. A jury trial is money for all the attorneys and that’s just good business. Oh and the jurys are a joke as well. Nobody in credit and collections will ever see a jury of THEIR peers………….

  3. “There is a status and responsibility that comes along with being in business for 43 years…

    Yes there is Kelly, and you and your family can be proudly stand at the head of that line. Your letter is an example of what it means to be a professional in our industry. Thank you for sharing and good luck. We feel your pain and we’re here to support you in any way we can…

    Art Christensen

  4. The real root of the problem are the attorney’s behind these suits. When you watch TV day or night the attorney’s are bombarding the air ways with commercials that promote frivolous lawsuits. It seems the advertising spots are during shows like Judge Judy, Jerry Springer, etc, obviously targeting a particular market. The plaintiffs are lead to believe they will win a large settlement, when the fact is they more often only get a couple of thousand dollars and the attorney’s on both sides make the bulk of the money. The courts play the game as well, the judges  almost never award fees to the defendants, and don’t hit the plaintiffs attorney with sanctions for bringing forth a frivolous suit tying up the courts dockets. In the long and short I guess the courts see this as income for all. You can and should put best practices in place and continue to train employees to follow the letter of the law. But don’t be shocked if you still become involved in a lawsuit, it’s not about right and wrong, it’s the money game. There are too many lawyers graduating every year, wheres the work to support those entering into the profession? They create it, the fraternity for lawyers is strong, both sides are dependent on each other. Insurance companies settle because the cost talley up so quickly, and jurors are notorious for for ignoring the facts and feel the big bad bank has hired the big bad repo company (as seen on True TV) and give ridiculous awards to the plaintiffs. So, the approach right or wrong, settle the case and move on. In the mean time, business’s close down because they lost a client or just depleted all the operating money they had. Welcome to the NEW AMERICAN WAY. 

  5. Good article,Kelly…………….Kevin and Equitable have stood the long
    test of time,and done so with great integrity.
    Your firm will always have our full support.
    Respectfully
    Ed

  6. With all the things going on in the world, compliance is truly the only way to manage risk. It is companies like Equitable that does the right thing even in the face of lawsuits that are frivolous. This truly is a great article, thank you for reminding us that there are great companies and good people behind those companies taking the hard but correct path.

  7. Kevin, you are right on. Lawsuits that are totally frivolous are filed everyday and our justice system doesn’t have any recourse for them. I feel your pain. You can even win in arbitration and the insurance company will settle because it is cheaper for them! If these bozos had to pay the winners attorneys fees the courts would see a lot less action. With the “reality” shows I expect to see a lot more of these frivolous lawsuits popping up. Clients need to know that just because you get sued, doesn’t mean you are guilty. In my experience of over forty years most will suspend you until the suit is over and then dump you even if you win. Good luck my friend and I know how hard you have worked at maintaining the highest of professionalism.

  8. Kelly, anyone can file a lawsuit. It does NOT have to be credible. They know you have been in business and assume that your won’t fight it. But if they don’t have any proof then you should win. It is a shame that you have to go through it! When you win, ask the judge for all your expenses.

  9. You said it right you and your company are among the top in the country you have every right to defend the reputation your family has spent a life time to build

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