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Portfolio Recovery Associates

Portfolio Recovery Associates LLC is a buyer of charged off debt. Portfolio may be showing up on your credit report or they may have served you with a lawsuit. Portfolio Recovery Associates LLC files thousands of collection lawsuits each year against consumers. PRA will hire a local collection attorney to file the lawsuit.

Portfolio Recovery will rely on witness testimony in a “business record affidavit” when trying to prove their case against you. It is important to fully understand the rules of evidence when attacking these affidavits and any documents attached. If you have recently been served with a Portfolio Recovery LLC lawsuit then you should take action to protect yourself.

Is Portfolio Recovery Associates Suing or Harassing You?
If you have been sued by Portfolio Recovery Associates, you are not alone. This debt collection company buys delinquent accounts from other companies and entities. It then uses various tactics to collect the debt from individuals including, but not limited to, harassing individuals with telephone calls and letters before filing lawsuits. According to the website, the company states, “We’re here to help you pay your debt.” Unfortunately, many times they forcibly obtain judgments and garnish bank accounts if you ignore them.

Who Owns Portfolio Recovery Associates?
Portfolio Recovery Associates is owned by PRA Group, Inc. operating under the name of Portfolio Recovery Associates, Portfolio Recovery Associates, LLC, Portfolio Recovery Associates, Inc., PRA, or PRA LLC. It is a publicly traded company with an average stock price of around $57 a share (known as PRAA on NASDAQ). In addition to owning Portfolio Recovery Associates, PRA Group, Inc. also owns several subsidiaries including MuniServices, LLC, PRA Receivables Management, LLC, and PRA Holding I, LLC. The founder of PRA Group, Inc. is Steven D. Fredrickson. He co-founded PRA Group, Inc. in 1996 and has served as its Chairman, Chief Executive Officer, and President since March 2002. The other co-founder, Kevin Stevenson, currently serves as the company’s Chief Financial Officer.

The company headquarters is located in Norfolk, Virginia:

Portfolio Recovery Associates, Inc.
Portfolio Recovery Associates, LLC (PRA LLC)
120 Corporate Boulevard
Norfolk, VA 23502
757-519-9300
888-772-7326
www.portfoliorecovery.com

According to the company website, PRA Group operates in North America and Europe. The North America operations include businesses in Virginia, Alabama, California, Illinois, Kansas, Nevada, New Jersey, Pennsylvania, Tennessee, and Texas. It also has an office located in London, Ontario. A list of company offices can be found on the company website.

What Types of Debt Does Portfolio Recovery Associates Purchase?
Portfolio Recovery Associates purchases several types of debt from various companies and entities throughout the United States. Most debts are delinquent unsecured debts that have been charged off by the original creditor such as credit card debt, medical debts, and personal loans. The company also purchases a large number of debts that are included in Chapter 13 bankruptcies.

Some of the companies or entities that Portfolio Recovery Associates purchases accounts from include:

  • Credit card companies
  • Hospitals or other medical providers
  • Banks
  • Credit unions
  • Retailers (i.e. department stores and other retail stores)
  • Telecommunication companies
  • Utility companies
  • Automobile finance companies
  • Consumer finance companies
  • Student loan lenders

Portfolio Recovery Associates pays the creditor a percentage on the dollar for the delinquent account. The creditor benefits by receiving some of the debt that it has charged off as bad debt and believes that it will never collect from the individual. Portfolio Recovery Associates benefits by receiving the account for less than is owed on the account with the intention of collecting the full amount owed from the individual thereby making a profit on the purchase. In order for this to be profitable for Portfolio Recovery Associates, the company must aggressively pursue collections efforts against each account.

Complaints Against Portfolio Recovery Associates for Unfair Collection Practices
The Better Business Bureau reports that during the past three years, 1,311 complaints were closed through the BBB. Of those complaints, 1,169 complaints were due to billing and/or collection issues. An alert on the BBB’s website refers to a settlement by Portfolio Recovery Associates, LLC with the State of New York regarding allegations that the company violated New York laws in its debt collections practices. N.Y. Attorney General Eric Schneiderman said, “Debt collectors must follow the same rules the rest of us do when bringing lawsuits — in this case, suing for debts that were not enforceable in the first place.”

Portfolio Recovery Associates often files lawsuits on debts that are too old to collect in an attempt to “scare” individuals into paying these debts even though there is no legal obligation on the part of the consumer to repay the debt due to its age. The company has agreed to pay $475,000 in penalties.

Portfolio Recovery Associates is also facing more problems as the Consumer Financial Protection Bureau (CFPB) investigates the company to determine if it has violated provisions of the Fair Debt Collection Practice Act. According to the CFPB, more than 11,000 complaints were filed between July 2013 and January 2014 against various debt collection companies, including Portfolio Recovery Associates. PRA ranked third for having the most complaints.

Another class action lawsuit is pending in the U.S. District Court in California from 2011. Plaintiffs claim that Portfolio Recovery Associates violated fair debt collection laws by using an autodialer to contact consumers on their cellphones. The Fair Debt Collections Practices Act sets forth the actions that a debt collector may not use in an attempt to collect a debt. Other provisions of the FDCPA include:

  • A debt collection cannot contact you before 8am or after 9pm unless you give the company permission to do so.
  • Debt collectors cannot contact you at work if you inform the company you cannot receive calls at work.
  • The use of threats of harm or violence is prohibited.
  • Callers cannot use obscene or profane language.
  • Repeatedly calling a person to harass or annoy that person is prohibited.
  • Debt collectors cannot say that you can be arrested if you do not pay the debt.
  • Debt collectors cannot misrepresent the amount you owe, falsely claim that you committed a crime, state they are a government official or calling from a government agency, or state that the papers they are sending or have sent to you are legal forms if the papers are not legal forms.
  • Debt collectors cannot contact you by postcard, use a false company name, or give false credit information about you to a credit-reporting agency.
  • A debt collection company cannot publish a list of names of people who have not paid their debts.

There are other provisions of the Fair Debt Collections Practice Act that an attorney can review with a consumer if the consumer believes he or she is being harassed or threatened by a debt collection company such as Portfolio Recovery Associates. Consumers have several courses of action they can take to stop creditor harassment and hold the company responsible for its unfair collection practices.

What Happens With a Judgment?
  • Bank Garnishment: Your bank account can be frozen and emptied by many judgment creditors
  • Judgment Lien: A judgment can often cloud title on your homestead property
  • Credit Report Damage: A judgment is published on your credit report as a “public record”
  • Property Sold: With a judgment, certain property can be sold at auction to pay towards the judgment
Do I Need a Lawyer?

With a Lawyer
Most of our cases are dismissed by the creditor prior to trial or we reach a favorable settlement for our clients depending on the circumstances of their situation.

Without a Lawyer
The majority of collection lawsuits end up with a judgment against the consumer. Primarily because they did nothing to protect themselves or attempted to defend themselves.

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