Bank of America Corp., and a debt collector it hired to go after deceased customers’ debts, violated state law by repeatedly calling a Florida woman about paying the credit-card bill of her late husband, according to a ruling by a Florida state court judge last month. Judge Keith R. Kyle in Lee County, Fla., found that collection attempts by West Asset Management, an Omaha, Neb., firm, working on behalf of Bank of America, rose to the level of harassment. The ruling clears the way for the Plaintiff to get punitive damages from the collector, a unit of West Corp., and Bank of America. A civil jury will determine the size of the award next year.
The ruling comes in a lawsuit filed by Linda Long, a 68-year-old retired office worker, alleging that the debt-collection firm harassed her by calling as many as ten times a day about $16,651.52 that her husband Millard had accumulated on a Bank of America credit card before his death from colon cancer in March 2010. William Howard, Mrs. Long’s lawyer, called the judge’s ruling a “stunning victory for Mrs. Long and other widows and family members.”
The case could set a precedent across the U.S. and discourage lenders from using collectors to get money from surviving relatives on debts left behind by the deceased, according to other state-court judges. Bank of America and other major U.S. lenders hand over accounts of the deceased to firms specializing in death-debt collection. The collection firms then zero in on family members who they think might agree to pay some of what the dead person owed even though they have no legal obligation to do so.
In a 2010 investigation of the industry, the Federal Trade Commission found that some death-debt collectors flout federal and state laws by duping relatives into thinking that they have to pay the debts of the deceased. Surviving family members typically have no legal obligation to pay unless they co-signed a loan. This case illustrates the unethical and illegal methods that banks will employ to recover unpaid loans – loans that banks made willingly and with the knowledge that the debtors may never repay the loans for any number of legitimate reasons. If you need more information on this subject, contact Clay Barnett, a lawyer in our firm, at 800-898-2034 or by email at Clay.Barnett@beasleyallen.com.
Source: Wall Street Journal
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