AARP wants the Ohio Supreme Court to sanction a collection agency for bringing a lawsuit that the debtor alleges had no legal basis and that also sought damages well beyond those permitted by law.
First Resolution Investment Corp. had sued Sandra J. Taylor Jarvis to collect on a credit card debt it had purchased from Chase Bank. Jarvis filed claims against First Resolution, alleging that it had engaged in deceptive practices illegal under Ohio and federal law, that the suit was barred by the statute of limitations stated in the underlying credit contract, and that the agency sought to collect an interest rate of 24% - well above that permitted by law. ??
First Resolution eventually withdrew its suit and the court dismissed Jarvis counter claims. Jarvis appealed in order to get a judgment regarding First Resolutions allegedly deceptive practices.
AARP Foundation Litigation attorneys filed AARPs friend-of-the-court brief on behalf of Jarvis detailing the deceptive practices used by collectors particularly to older consumers and those on fixed incomes that literally can be "life threatening when a debtor is forced to choose between paying for food, shelter, medical needs or debt."
The brief also discusses the business practices in the collection industry. According to the AARP, the industry has "built-in incentives for abuse. Numerous studies show that collectors often do not have sufficient evidence to support claims yet clog the courts with hundreds of thousands of collection lawsuits every year, knowing the vast majority of the judgments will be granted by default. Commonly, old debt is purchased in portfolios containing masses of accounts with each individual account costing only a few cents on the dollar. The incentives are to press forward with cases regardless of the validity, practices which harm consumers as well as courts."
AARP previously has participated in other cases advocating for the interests of victims of collection abuses.
People age 50 and above are incurring and amassing increasingly unaffordable levels of debt, often triggered by the need for immediate cash due to medical treatment. Older people also are extremely vulnerable to the tactics of and threats made by collection agencies and are fearful of challenging debts even if those debts are erroneous, old, or had actually been paid off. The bad data, record keeping, and collection practices in the collection industry cause consumer abuses of significant concern, particularly in a down economy where collectors are more zealous and debtors have even fewer resources.
??Case Status: ??Jarvis v. First Resolution is before the Ohio Supreme Court, the states highest court.