State AG Goes After Adult Website Debt Collector

Ohio Attorney General Mike DeWine Thursday filed a lawsuit against a debt collection agency seeking at least $175,000 in fines for practices his office said were violations of Ohio’s Consumer Sales Practices Act and the federal Fair Debt Collection Practices Act (FDCPA).

DeWine filed his suit against Royal Oak Financial —  d/b/a Collection and Recovery Bureau (CRB) – a collection agency based in suburban Toledo, Ohio. DeWine said that consumer complaints prompted the investigation that led to the action.

Consumer complaints claimed that CRB used harassing methods to attempt to collect, such as frequent calls, abusive language, and false threats of arrest or lawsuits. When the company was challenged, it sent questionable documentation to verify the debt.

CRB was mostly working debt from online porn or Internet “dating” sites. DeWine claims that many of the consumers were victims of credit card fraud and had never visited the sites. In fact, most of the targeted consumers successfully disputed the bills with their credit card companies, but still found themselves in CRB’s crosshairs.

The Columbus Dispatch reported that it had contacted CRB’s president who claimed the company was closed down on August 31. He said that the closing was not related to DeWine’s investigation, but that ongoing economic weakness was to blame.

The paper noted that shuttering the company would not shield it from the lawsuit.

DeWine in 2012 has gotten more active in regulating the ARM industry.

In February, he led a group of 19 state AGs that targeted ARM giant NCO Group, leading to a $1.5 million settlement with the firm.