Wisconsin Consumer Sues ConServe Over Allegedly Misleading Debt Collection Practices

New to ClassAction.org? Read our Newswire Disclaimer

Continental Service Group Inc. (which does business as ConServe) is on the receiving end of a proposed class action lawsuit filed by a Wisconsin consumer who claims the debt collector sent her a misleading collection letter.

The complaint says the notice, which pertained to an alleged student loan debt, listed the “total due” as $19,494.38 and also informed the plaintiff that her payment of $10.00 – pursuant to a prior authorization – would be processed on a specific date. The suit argues that these statements contradict each other because listing the “total due” implies that the loan has been accelerated and the plaintiff owes the entire balance, while the reference to her $10 payment implies that the debt is only in default and the full balance is not yet due.

The case takes further issue with the letter’s alleged statement that the plaintiff’s account may be subject to interest, late charges, and “costs of recovery.” According to the complaint, this information could mislead the unsophisticated consumer in the following ways:

• if the loan had been accelerated, the debt collector implied that it would be subject to late fees when additional charges could not be collected;
• if the loan were to be reinstated after the processing of the plaintiff’s $10 payment, the defendant again falsely implied the account would be subject to late fees, noting that the plaintiff’s creditor did not intend to impose these extra charges on a reinstated loan;
• if the creditor did, in fact, intend to collect late fees, the defendant failed to inform the plaintiff that her $10.00 payment would reinstate the loan and cause it to be subject to additional charges.

“In any case,” the complaint summarizes, “[the defendant’s letter] is false, deceptive, and misleading because the loan has either been reinstated or it has not; if it has been reinstated, the ‘amount due’ would be considerably less than the total balance ‘owed,’ and if it has not been reinstated, neither ConServe, nor the federal government could or would charge late fees.”