CHARLESTON -- West Virginia Attorney General Darrell McGraw announced Friday his office has reached agreements with two out-of-state debt collection firms to halt their services in West Virginia, cancel consumers' debts and pay fines.
McGraw said in a statement he was acting on a consumer's complaint that "his credit card account had been sold so many times he could no longer identify who the creditor was."
Neither of the companies named in the settlements -- Carpenter Capital Investments, a debt purchaser located in Buffalo Gap, Texas, and National Recovery Services, a debt collection agency in Ottawa, Kan. -- was licensed or bonded to collect debts in West Virginia, McGraw's office said.
Under state law, any person who directly or indirectly collects a debt that was originally owed to another must obtain a business registration certificate from the West Virginia Tax Department and post a $5,000 bond for each office location.
The attorney general's investigation revealed that Carpenter Capital Investments had purchased the consumer's credit card account and assigned it for collection to National Recovery Services.
Under the terms of the settlements, Carpenter Capital agreed to cancel the outstanding balances of West Virginia consumers whose debts it had previously assigned for collection, McGraw's office said in a statement.
Both companies also agreed to stop debt collection in West Virginia until they have registered as debt collectors and posted the required bond and each paid a $1,000 penalty to the state, the attorney general's office said.