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Can I sue the State of Maryland for fining me and threatening my credit rating without cause or evidence?

Arlington, VA |
Filed under: Credit Evidence

I received a notice from the State of Maryland Central Collection Unit entitled a "Delinquency Notice for MVA Insurance Lapse Default." This was my first notice. It states a payment in full is due upon receipt of this notice. It also says "Where applicable this debt will be reported to a credit agency and may affect your credit rating." I've already discovered the call center days and hours are completely incorrect on the notice. I recently moved from the state, but have never, in my life, not had insurance coverage on my vehicle. I followed all procedures to the letter during my move and have all the proper documentation. Getting this debt redacted is not enough for what seems like a state sponsored scam. Can I take legal action at some point against the state?

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Attorney answers 2


Threats are generally not actionable, since every claim needs both liability and damages. In other words, it's not enough that they made a mistake and might have made a worse mistake, they have to actually have harmed you. Generally, the "no harm, no foul" rule applies.

Here, if you get the error corrected and don't have to pay any fine and don't get any negative credit entry (or get it removed if their erroneously report somethin negative), you haven't been harmed. Yes, you still suffer the aggravation and inconvenience of correcting their mistake, but that's not something you can sue for.

PLEASE READ THIS BEFORE YOU COMMENT, EMAIL ME OR PHONE ME. I'm only licensed in CA. This answer doesn't make me your lawyer, and neither do follow-up comments and/or emails and/or phone calls, and you shouldn't expect me to respond to your further questions if you haven't hired me. We need an actual agreement confirmed in writing before any attorney-client relationship is formed. This answer doesn't constitute legal advice, and shouldn't be relied on, since each state has different laws, each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue.



Thanks for your answer. It is a sad fact that we have no protection against these claims by the state. This seems to be no different than those old billing scams where if you send "Internet Services" billing invoices out to 200 major companies, at least 10% will blindly pay them without inspection. Once I have this cleared this up I will be extremely interested to find out if it was initially reported to credit agencies or if that was one of the scare to pay tactics. What is stopping the state from sending these bills to anyone that leaves Maryland (or anyone in general)? There's absolutely no accountability.


In addition to what Ms. Koslyn said, states have sovereign immunity. What you need to do is prove to MD's MVA that you moved from the state and show them the vehicle was continually insured. That should take care of the problem. IF it gets reported, you can send a letter to them asking that they remove the report since it was incorrect. Also, dispute it with the credit bureaus. I do not believe that it will come to that. Usually, all that is required is faxing some documents back and forth or mailing a statement.

Mr. Goldstein is a Virginia-licensed attorney only. The information is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation. Answering this question does not in any way constitute legal representation. Contacting Mitchell Goldstein or the Goldstein Law Group does not constitute legal representation, nor is any information you provide protected by attorney-client privilege until otherwise advised.



We just received the same notice. We sold our car when we moved from Baltimore in 1999. I spent a lot of time on hold today until finally the customer service representative came back and breezily told me they had the sale on file and would dismiss my case. I’m sorry but, hello? Seriously? Oh, she also said she had no way of knowing whether this had affected our credit profile. I don’t want to sue, but either the state of Maryland (or Baltimore) is mind-bogglingly incompetent (not impossible) or something very fishy (or phishy) going on. I saw a fair number of similar comments online, several of which said that they bargained down to a smaller amount. If the claims by the Central Collection Agency are bogus in the first place, it’s a win for the state. I’m just posting this here because there seems to be a lot of this going around and I’d hate to think anyone would just, as the automated payment line says, provide their ss# and cc# or send a money order to the very generically named “Central Collection Unit.



I finally spoke with someone in the "Central Collection Unit" office who just told me to call the DMV. They state that when I moved out of MD to VA on 2/1 and contacted my insurance company to let them know I moved several days later, I failed to have Maryland insurance on my car at that point. They claim to have received my tags in the mail two months after I mailed them. So the catch 22 is I was supposed to either lie to my insurance company and not tell them about my move or have two policies for one car until they officially received the tags. Pretty rediculous either way. I'm getting harassed for doing everything by the book. They say that's Maryland law, which I reminded them the only documentation (I checked before I moved) was saying that I can't "cancel" my policy until tags are received. Not update my address on the policy to match my current residence. It sounds like they'll give up the claim once they get the letter from my insurance but this is just such a scam for money. The proof of claim should be coming from them and not me.

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