Debt Collection Class Action Filed Against Northland Group Inc.
Last Updated on May 8, 2018
Stiel v. Northland Group, LLC
Filed: November 9, 2016 ◆§ 1:16-cv-06228
A lawsuit has been filed in New York against Northland Group Inc. claiming the Minnesota-based debt collection agency violated the Fair Debt Collection Practices Act.
A class action has been filed in New York against Northland Group Inc. claiming the Minnesota-based debt collection agency violated the Fair Debt Collection Practices Act (FDCPA) by making deceptive statements in collection letters sent to consumers. The complaint alleges the defendant included in a collection letter to the plaintiff that “CITIBANK, N.A. will report forgiveness of debt as required by IRS regulations.” This language is deceptive and could be misinterpreted by the unsophisticated consumer, the lawsuit argues, because it could be taken to mean the law requires debt forgiveness to be reported to the IRS in all circumstances, which is not true.
Case documents cite that if a debt collection agency chooses to provide tax advice to debtors—which it usually has no obligation of doing—“it must do so in a way that it will not mislead the least sophisticated consumer as to his or her tax consequences.” In this case, the defendant allegedly failed to tell the plaintiff that the forgiveness of a debt needs to be reported to the IRS only if the principal debt amount exceeds $600.
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