A simple case of sending faxes to the wrong department has led to an expensive lesson for one law firm. Guards Law, a consumer protection law firm specializing in debt collection cases, has agreed to pay Portfolio Recovery Associates (PRA) $5,000 in a settlement that highlights the importance of following proper communication channels in debt collection disputes.
The story began when a consumer filed suit against PRA, claiming the company had violated the Fair Debt Collection Practices Act by not updating her credit report after she submitted a dispute. While the fax transmission was successful, it turned out the dispute had been sent to PRA’s human resources department fax number rather than their designated disputes line.
As PRA investigated further, they discovered this wasn’t an isolated incident. Multiple Guards Law clients had sent disputes to the same HR fax number, creating a pattern that caught the debt collector’s attention. The trail led to Credit Saint, a credit repair organization that had been providing the HR fax number to consumers before connecting them with Guards Law.
The case took an interesting turn when PRA refused to let the matter drop even after the consumer sought to dismiss her lawsuit. Instead, they pushed for discovery to understand whether the case had been filed in bad faith. Under court order, Guards Law’s managing attorney Joy Coleman provided a sworn declaration revealing Credit Saint’s role in directing disputes to the HR fax number.
The final settlement requires Guards Law to pay PRA $5,000, stop pursuing claims based on disputes not sent through PRA’s official channels, and release all claims from clients whose demands stem from disputes sent to unofficial contact points.
While Guards Law maintains that the HR fax number had previously accepted disputes, the settlement demonstrates the importance of using officially designated communication channels in debt collection matters. The case serves as a reminder that even seemingly minor procedural details, like which fax number to use, can have significant legal and financial consequences.
The resolution marks a notable victory for PRA, who chose to investigate the unusual pattern of fax communications rather than simply allowing the case to be dismissed. Their persistence in uncovering the full story led to a settlement that addresses not just one case, but potentially prevents similar situations in the future.
