Credit Management Services Facing Lawsuit Over Debt Collection Practices

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Credit Management Services, Inc. (CMS) and one individual are the defendants in a proposed class action that alleges the parties violated the Fair Debt Collection Practices Act (FDCPA) and the Nebraska Consumer Protection Act (NCPA). The lawsuit takes issue with the defendants’ alleged routine practice of filing collection complaints in Nebraska courts to collect debt obligations for past-due medical accounts. These collection complaints allegedly request, for the defendants, an entitlement to an award of statutory attorneys’ fees and prejudgment interest through its in-house attorneys by “misrepresenting the nature of the consumer’s account as for ‘goods or services’ rendered, rather than as actions on ‘ACCOUNTS,’” the lawsuit says.

The problem with the defendants’ alleged conduct is that the parties claim an entitlement to an award of attorneys’ fees even though no Credit Management Services attorney appeared on behalf of the company.

“It is [the defendants’] routine practice to file county court collection complaints to recover allegedly past-due medical accounts in the form of Exhibit A which claim entitlement to an award of attorneys’ fees although no attorney(s) who was not a full-time employee of CMS appeared on behalf of CMS,” the complaint reads.