NY AG Shuts Down Buffalo Area Debt Collection Agency

New York Attorney General Eric T. Schneiderman Thursday announced that he has shut down Swanson Walker & Associates, a consumer debt collection agency located in Lockport, New York. The owner, Sean Millard, entered into an agreement with the Attorney General by which he was required to shut down the business and pay a $10,000 fine.

The Attorney General’s Office, the Better Business Bureau, and the FTC’s Sentinel Network had received dozens of complaints about the tactics the agency used when attempting to collect repayments.

“Attempting to get out of debt is a stressful and overwhelming process that countless consumers struggle with every day,” Attorney General Schneiderman said. “To threaten and bully these individuals is unacceptable and wrong, and my office will keep fighting to hold those who employ these tactics accountable.”

According to complaints, Swanson debt collectors repeatedly and persistently violated the law by (i) improperly calling consumers at their places of employment; (ii) improperly accusing consumers of check fraud and violations of the penal law and threatening consumers with arrest or imprisonment; (iii) falsely representing that a lawsuit had been, or would be filed; (iv) improperly disclosing consumer debts to third parties; and (v) improperly threatening to seize a consumer’s property, freeze bank accounts and garnish wages.

Swanson also maintained a website that was replete with false representations about the firm’s involvement in the legal collections channel, including the following assertions investigated by Schneiderman’s office:

“We utilize two methodologies of collections, traditional collection services and litigation.”

• Swanson never litigated a case, according to Schneiderman.

“Litigation is a collection effort made by our associates (non-attorney assistants) under the direction of an attorney.”

• The investigation revealed that Swanson never employed or retained an attorney, and an attorney never gave direction to the company’s associates.

“Litigation efforts commence when a matter cannot be resolved by our recovery specialists.  At this point a retained attorney determines that an account is eligible for litigation, within our jurisdiction, & with the client’s approval the legal process begins.”

• Swanson never retained an attorney to review matters and never filed a lawsuit.

“Once a judgment is obtained we use post-judgment remedies such as wage garnishment and levying on property or bank account.”

• Swanson never obtained a judgment and never used post-judgment remedies such as wage garnishment and levying on property or bank account.

“Our clients may place accounts with us that are strictly designated for litigation and not for collection purposes.”

• Since Swanson never litigated a case, this representation was false, according to Schneiderman.

This case was handled by Assistant Attorney General James Morrissey and Karen Davis, Senior Consumer Fraud Representative in the Buffalo Regional Office.