CHARLESTON -- West Virginia Attorney General Darrell McGraw on Tuesday announced a settlement with a New Jersey lawyer and several out-of-state debt collection agencies that the lawyer represents.

The settlement resulted in more than $7.9 million in cancelled debts for residents, McGraw's office said.

The attorney general's Consumer Protection Division entered into an agreement with Laurence A. Hecker and his two affiliated Pennsylvania collection agencies, APM Financial Solutions, LLC, and Account Portfolio Management, LLC.

The settlement requires the cancellation of $7.9 million in charged-off credit card debt that Hecker and the APM Companies attempted to collect from 1,922 West Virginia consumers. The companies also paid $45,000 toward customer refunds and consumer education and agreed to delete the debts from credit records, according to McGraw's office.

"The credit card industry and predatory lenders have sometimes saddled West Virginia consumers with exorbitant debts," McGraw said in a statement.

"This unfortunate situation has now evolved into a multibillion-dollar debt-buying industry in which unlawful tactics are used to coerce consumers to pay debts they may not owe with funds they do not have."

McGraw began investigating Hecker and the APM Companies in 2006 after receiving complaints from state consumers who reported they were threatened with lawsuits and excessively pressured to pay alleged debts. Hecker also allegedly sent letters to consumers on his law office stationery to demand
payment of the debts.

The attorney general's investigation revealed that the majority of the collection attempts were for "time-barred" debts, or debts so old that the statute of limitations to sue had expired and lawsuits were therefore barred by law.

McGraw's office also discovered that Hecker and the APM Companies -- which were attempting to collect debts in West Virginia without being licensed or bonded as required by state law -- were demanding payments without any proof that they owned the debts or of the amounts owed other than a computer spreadsheet.

"I will not allow consumers facing dire financial circumstances to be crushed by abusive collection practices. My office will continue our vigorous efforts to enforce the law against unscrupulous collection agencies and debt buyers," McGraw said.

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