Understanding the Consumer Financial Protection Bureau v Frederick J. Hanna & Associates Case
Mid July 2014 the Consumer Financial Protection Bureau filed a lawsuit against a mass collection-mill law firm for violation of two statutes. The Consumer Financial Protection Act and the Fair Debt Collection Practices Act.
Consumer Financial Protection ActIn Mid July the Consumer Financial Protection Bureau sued the law firm of Frederick J. Hanna & Associates, a law firm based in several states that specializes in mass debt collections. The lawsuit alleges and plausibly concluded that the law firm and its army of attorneys spent roughly 1 minute each reviewing lawsuits that they filed on behalf of named creditors and second debt buyers and collection agencies, and filed affidavits where the affiants generally had no knowledge of the actual debts or even the contents of the affidavits.
Fair Debt Collection Practices ActThe government contends that the law firm essentially is not a law firm acting as a lawfirm but in fact is a mass collection mill that employs a much larger army of non-attorneys to select which lawsuits to file and against which defendants. Estimating that hundreds of thousands of lawsuits were filed in Georgia alone and 40,000 of which were dismissed routinely when a defendant appeared and answered, the CFPB surmised that the lawfirm was essentially attempting to obtain default judgments against people.