cap one and charge-offs

Re: cap one and charge-offs long

CCmax,

Thay buy an old charged off account for let's say $5799, give you a limit of $2800 with $100 available for new purchases and cash, put the difference 5799-2800=2999 into a special account so you are not charged over the limit fees, and a 9.9 intro rate for the whole thing until 2002. So you have to pay over $3000 before you have any more free credit. and of course they probably purchased the account for a fraction of the 5799. I had posted the below about a month ago. I thought I saw a web site that said this practice was illegal. But according to the ruling below it is not. But what is though is re-aging the debt which they have done to me. It was chgd off in 96 they show it on my TU as open 10/2000, charged off 11/2000. The account is serviced by the wonderful Westmoreland agency. When I confronted them about the re-aging they said it was TU's fault. While I am no fan of TU I think that is a bunch of BS. I will sue Westmoreland later, right now I have bigger fish to fry(Experian) for claiming to verify a JC Penny account that wasn't mine, which I have 2 letters fron Penney's saying they are taking it off all 3 reports, and also the lady from Penney's saying NO CRA has contacted them regarding the account. But below is the CAP1 ruling:

From the College of Journalism, Capital News Service on, Wednesday, April
11, 2001.

^CNS-Debt Owed,410<
^Judge Rejects Claim That Collection Agency's Letter on Old Debt Was
Deceitful<
^By ARHEUN KIM=
^Capital News Service=

WASHINGTON - Collection agencies can invite people to pay off an old
debt without running afoul of federal law, even if the debtors no longer
have a legal obligation to pay it off, a federal judge has ruled.
Denita J. Wallace of Baltimore claimed the notice she received from
Capital One Bank last April tried to get her to pay off an old $1,681.27
debt, without pointing out that she was not legally obligated to pay
anymore, according to her attorney.
Wallace said that was a violation of the Federal Debt Collection
Practices Act, which says a "debt collector may not use a false,
deceptive, or misleading representation or meanings in connection with
the collection of a debt."
But U.S. District Judge J. Frederick Motz rejected that argument. He
ruled Friday that while Capital One Bank did not disclose the fact that
the debt's statute of limitations had run out, it did not violate the
collections practices act.
"No violation of the FDCPA occurs solely because a debt validation
notice silent on the time-bar issue is sent to the debtor," Motz wrote in
his ruling. He said it would also have to be shown that "a debt collector
has engaged in a course of conduct that tricks a debtor into waiving his
legal right to assert a limitations defense."
But Wallace's attorney, Randolph bragg, said he believes collection
agencies prey off individuals who are not as "suspicious" as Wallace was
when she received her collection notice. He said he "deals with cases
like this all the time."
"We believed that hundreds, maybe thousands of people were getting
tricked," said bragg. "I'm disappointed in the decision because I think
the omission of the facts deceives the consumers."
bragg said the notice is misleading because, if Wallace had actually
decided to pay off some of the debt out of a moral obligation she may have
felt, she would have revived the entire debt. That would have given
Capital One Bank the opportunity to sue her for the entire amount of the
debt.
A spokesman for Capital One Bank declined to make any official
comments regarding the case.
Wallace could not be reached for comment Wednesday afternoon.
bragg said it is a common practice for banks such as Capital One to
purchase expired debts for a small fraction of the full debt in order to
try to get the debtor to pay it off.
-30- CNS 04-11-01