Lawsuit Claims First National Collection Bureau, LVNV Funding Misled Consumer in Unlawful Letter

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A proposed class action alleges that First National Collection Bureau, Inc. and LVNV Funding LLC failed to comply with the Fair Debt Collection Practices Act (FDCPA) by conveying “false and misleading” information in a debt collection letter.

The plaintiff received the letter – which was sent by First National Collection Bureau on behalf of current creditor LVNV Funding – in April 2018 regarding a debt originally owed to HSBC Bank Nevada. The letter allegedly listed a total amount due of $12,622.61 and indicated that no interest had accrued on the balance since the debt was charged off. The defendants, however, also included in the letter contradictory information that may have suggested otherwise, the case argues. According to the suit, the notice contained unlawful language that stated, in part: 

“This is to advise you that a judgment has been entered against you. The judgement against you has been paced [sic] with our office for collection by our client LVNV Funding LLC.”

This language failed to disclose any specific information regarding the alleged “judgment,” the complaint says, leaving the plaintiff confused as to the status of her debt and what interest or fees had been or may be applied. According to the lawsuit, the letter also stated the following: 

“Because of interest that may vary from day to day, the balance owing on the day you pay may be greater.” 

The complaint notes that the “generally applicable” post-judgment annual interest rate is 9% in New York. The suit argues that if a “judgment” had in fact been entered, an interest rate of 9% would have been accruing on the debt balance, meaning that the prior indication that no interest has accrued on the debt was false. If, on the other hand, no such “judgment” had taken place, the suit argues that the defendants falsely claimed that the debt balance may increase due to accruing interest.

Moreover, the suit argues that “the threat of a balance increase” overshadows the plaintiff’s right to dispute her debt by pressuring her to make a timely payment.

The proposed class action alleges that the contradictory, unclear and deceptive language of the letter violated the FDCPA and misled the plaintiff.