Wednesday, May 27, 2009


Cuomo Shuts Down NY Collection Agencies That Threatened and Intimidated

Consumers Into Paying Debts They Didn’t Owe

Sends Subpoenas to Nearly 20 Debt Collectors Statewide

NEW YORK, NY (May 27, 2009) - Attorney General Andrew M. Cuomo today
announced that his office has launched a statewide inquiry into debt
collection companies. As part of the inquiry, the Attorney General’s
Office obtained a court order against Lamont Cooper and his two debt
collection companies, Emanee Development, Inc. and Dial Tech LLC, under
which the companies will shut down and Cooper will be forced to pay
restitution to consumers statewide.

According to Cuomo’s Office, Cooper’s companies unlawfully lied to
consumers, threatened to arrest them, and intimidated them into paying
debts that they sometimes did not even owe. They would often call third
parties like neighbors or employers to further embarrass and harass
consumers. The Attorney General also announced that his Office has
subpoenaed nearly 20 other debt collectors across the state in his
ongoing investigation into various facets of the debt industry.

“At a time when New York families are already struggling with
unprecedented levels of debt, unscrupulous collection agencies add salt
to an open wound,” said Attorney General Cuomo. “Using fear and
intimidation to take advantage of individuals facing debt is a shameful
and illegal scare tactic. This judgment is the first step in this
Office’s expanding investigation into debt collectors that violate the
rights of consumers and operate outside of the law.”

According to the Attorney General's Office, Cooper operated Emanee and
Dial Tech, which did business under the names of various shell companies
and fictitious law firms across the state, including: Claims Process
Services, Claims America, CMC Recovery Services, Lomax & Barnes and
Murray, Bradshaw & Associates. Collectors at the companies used illegal
and fraudulent tactics to collect debts. Emanee and Dial Tech

● Falsely accused consumers of criminal activity and told them
that they had committed criminal fraud;
● Falsely informed consumers that they would be arrested within 24
hours if they failed to pay the alleged debt;
● Threatened consumers with law suits even though the collectors
were not lawyers
● Sought collection of debts beyond the six year statute of
● Illegally discussed debts with third parties like employers and
neighbors to embarrass and harass consumers; and
● Failed to provide legally required written notices to consumers
about their rights to dispute the validity of the alleged debt.

Some consumers, intimidated by these unlawful practices, then paid
debts that they did not even owe. The tactics used by Emanee and Dial
Tech are prohibited by both the federal Fair Debt Collection Practices
Act and the New York State debt collection and consumer protection

State and federal laws stipulate that collectors cannot do the
following: pose as an attorney, threaten lawsuits or other legal action
which cannot be taken, say a consumer committed a crime or will be
arrested, talk with third parties except to get location information and
cannot engage in conduct meant to harass, oppress or abuse consumer. The
law further requires collection agencies to send a written notice within
five days of initial communication with the consumer explaining how he
or she can dispute the debt. If properly disputed, the collection agency
must stop all collecti
on attempts and send verification.

Under the terms of court order obtained by the Attorney General’s
Office, Cooper and his two companies agreed to pay restitution to
consumers who paid debts they did not owe. Additionally, Cooper and the
two corporate entities are permanently barred from engaging in the debt
collection business. Cooper and the businesses are also permanently
banned from acting as brokers that buy and then re-sell portfolios of
consumer debt to individuals who then intend to hand the debts over to
collection agencies that Cooper selects or with whom he otherwise has a
business relationship. The judgment was signed by the Hon. Diane Y.
Devlin in the Supreme Court of the State of New York, Erie County.

The Attorney General’s investigation into Cooper, Emanee and Dial
Tech is part of a larger investigation into debt collection practices.
These practices, which violate both state and federal law, include a
broad array of potential wrongdoing, including: fraudulent threats of
criminal prosecution, harassing phone calls to consumers and their
families, friends and employers, bringing lawsuits against and/or
reporting consumers to credit reporting agencies without verifying that
the consumer being targeted actually owes the debt, and failing to
disclose that a caller is working for a debt collector.

Attorney General Cuomo has subpoenaed nearly twenty companies and law
firms operating as debt collectors throughout the state. The subpoenas
included requests designed to discover the policies and procedures the
debt collectors have implemented to comply with federal and state laws,
how the companies respond to complaints about their collection
practices, as well as how individual collectors are compensated.

The companies subpoenaed by Cuomo’s Office include: Cavalry Portfolio
Services, LLC; Cohen & Slamowitz, LLP; Debt Recovery Solutions LLC;
Eltman, Eltman & Cooper; Forster and Garbus; LHR, Inc; Mel S. Harris &
Associates, LLC; Med-Rev Recoveries, Inc.; Mitchell N. Kay, P.C.; NCO
Portfolio Management, Inc. and NCO Financial Systems, Inc.; North Shore
Agency, Inc.; RJM Acquisitions LLC; Rubin & Rothman LLC; and Sharinn &
Lipshie P.C.

Earlier this month, as part of his ongoing investigation into unlawful
debt practices, Attorney General Cuomo announced a lawsuit against two
debt settlement companies for fraudulent business practices and false
advertising. Cuomo filed suit against CSA-Credit Solutions of America,
Inc. (“CSA”), based in Richardson, Texas, and Nationwide Asset
Services, Inc. (“NAS”), based in Phoenix, Arizona for making
millions of dollars by selling misleading debt settlement plans that
very rarely deliver the promised benefits to consumers dealing with

Cuomo also launched a website - - that explains
consumer rights, allows victims of debt settlement companies quick
access to the Attorney General’s office to file complaints, and
outlines the stages of the Attorney General’s investigation.

This investigation and lawsuit were handled by Assistant Attorney
General Dennis Rosen and legal intern Liz Blazey, under the supervision
of Deputy Attorney General for Regional Affairs David Sampson and
Assistant Attorney General in Charge of the Buffalo Regional Office
Russell Ippolito.

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