McGraw

CHARLESTON -- West Virginia Attorney General Darrell McGraw has filed suit against a debt-collecting agency, alleging it engaged in illegal practices when it tried to collect debt from West Virginia consumers.

Among its multiple alleged illegal practices, Charles Howell and Associates failed to obtain a West Virginia collection agency license and failed to pay a surety bond of $5,000 before it began business in West Virginia, according to a complaint filed Oct. 6 in Kanawha County Circuit Court.

Charles Howell and Associates has been collecting debt in West Virginia since 2006, and a majority of its collection contracts are for unpaid NTelos cancellation fees, the suit states.

McGraw claims the company did not obtain a license until at least September 2006 and also conducted business in the state while it had an expired license.

He also claims the state received 20 complaints against Howell of other illegal acts such as coercive threats and financial disclosures to debtors' employers or associates.

It is unlawful for debt collection agencies to threaten lawsuits, unless the agency files suits as part of its business, according to the complaint.

Howell threatened to file suits against clients, but does not file them as part of its business, McGraw claims.

In his suit, McGraw claims Charles Howell engaged in multiple unfair or deceptive practices – the company illegally threatened to garnish wages without telling consumers of a judicial order that must be in effect before that can happen, accused or threatened to accuse a consumer of conduct that would disgrace the consumer, told consumers' family members of their debt and threatened the debt may increase by the addition of attorney's fees, investigation fees, service fees or other fees, the suit states.

"Collection agencies earn a commission from every dollar they draw from consumers' accounts, so incentives for coercion, threatening behaviors and unlawful tactics are abundant," the suit states.

McGraw seeks a temporary order restraining Howell from engaging in any collection activity against any consumers in West Virginia until the matter is resolved.

He also seeks a permanent order requiring Howell to refund all money it received from West Virginia consumers and other consumers, an order requiring Howell to forgive any and all debts Howell asserts to be due to it and an order requiring the company to ensure the deletion of any and all credit reporting references of a West Virginia consumer to Howell.

McGraw also seeks an order requiring Howell to pay civil penalties of $5,000 per violation, costs and attorney's fees, all of which would be placed in a trust and used at the discretion of the attorney general for consumer protection purposes.

He is seeking unspecified civil penalties and prejudgment interest.

Christopher Hedges of Charleston is acting as an assistant attorney general in the case.

Kanawha Circuit Court case number: 08-C-1935

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