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On December 7, 2015, the Consumer Financial Protection Bureau (CFPB) announced an enforcement action against debt collection firm Collecto, Inc. d/b/a EOS CCA (EOS) for allegedly violating the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, and the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The CFBP’s complaint, which was filed in federal district court in Massachusetts, alleges that in 2012 EOS paid AT&T $35.4 million for a portfolio of more than three million cellphone accounts that had a face value of approximately $2.3 billion.  The CFPB alleges that despite EOS learning that the portfolio contained fraudulent, already paid, or already settled debts, EOS

  • continued to take action to attempt to collect the debt from consumers;
  • reported to credit reporting companies inaccurate information, including that all three million consumers disputed the debt despite knowing that not all debts were disputed; and
  • collected nearly $743,000 on more than 2,300 accounts that consumers disputed and EOS failed to verify.

Although EOS has not admitted any wrongdoing, EOS and the CFPB agreed to a Stipulated Final Judgment and Order which, if approved by the court, would require EOS to

  • stop collecting and reporting on consumer debt that has been disputed by consumers and which EOS is unable to verify or substantiate;
  • stop collecting on debt that EOS has reason to believe contains inaccurate information;
  • stop reselling debt that it obtains from other debt collectors, for five years;
  • ensure information provided to credit reporting companies is accurate; and
  • pay a $1.85 million civil penalty.

The enforcement action against EOS is just the latest in a number of CFPB enforcement actions related to debt collection services, underscoring a clear priority for the CFPB.  Indeed, the CFPB’s November 20, 2015 Semi-Annual Report noted that approximately 30 million consumers currently have accounts in collection and that debt collection complaints accounted for 32 percent of all consumer complaints received by the CFPB from October 1, 2014, through September 30, 2015.  Further, the CFPB’s Fall 2015 rulemaking agenda, indicates that the CFPB is currently conducting research in anticipation for rulemaking related to debt collection activities.

You can view the CFPB complaint against EOS here:

You can view the CFPB and EOS Stipulated Final Judgment and Order here:

You can view the CFPB’s November 20, 2015 Semi-Annual Report here:

You can view the CFPB’s Fall 2015 rulemaking agenda here:


Stinson Leonard Street LLP provides sophisticated transactional and litigation legal services to clients ranging from individuals and privately held enterprises to national and international public companies. As one of the 100 largest firms in the U.S., Stinson Leonard Street has offices in 14 cities, including Minneapolis, Mankato and St. Cloud, Minn.; Kansas City, St. Louis and Jefferson City, Mo.; Phoenix, Ariz.; Denver, Colo.; Washington, D.C.; Decatur, Ill.; Wichita and Overland Park, Kan.; Omaha, Neb.; and Bismarck, N.D.

Zane Gilmer is a member of the firm’s litigation practice group.  His practice focuses on business litigation and compliance and he is a member of the firm’s CFPB taskforce.  Zane works out of the firm’s Denver office and he can be reached at or 303.376.8416.

The views expressed herein are the views of the blogger and not those of Stinson Leonard Street or any client.