Associated Credit Services Sued Over ‘Unauthorized’ Collection Fees

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Associated Credit Services, Inc. is on the receiving end of a proposed class action lawsuit that claims it sent a New York consumer misleading debt collection letters. According to the suit, the plaintiff received two letters around the same time from the defendant that referenced the same account, but listed a different amount of “fees.” The complaint alleges that Associated Credit Services charges collection fees in advance, based on its anticipated compensation for collecting debt on a creditor’s behalf. The suit argues that defendant is not entitled to any collection fee until it has received payment from the consumer, which, in this case, it had allegedly not received as of the date of the letters. The defendant’s demand for an “unauthorized fee,” the complaint claims, is illegal under the Fair Debt Collection Practices Act and causes the letters to be considered misleading to the unsophisticated consumer.