$ 66 million settlement ends debt collectors
BUFFALO, NY (WKBW) – The New York State Attorney General has announced a $ 60 million settlement that will shut down a Buffalo-based debt collection company. Three debt collection companies in total make up the $ 66 million settlement.
Douglas MacKinnon, who owns Northern Resolution Group and Enhanced Acquisitions, will have to pay back millions of dollars in damages and penalties. Delray Capital, a Toronto-based company owned by Mark Gray, was fined $ 6 million, but was suspended from $ 10,000 for “inability to pay.”
“This was an elaborate and unscrupulous scam ploy,” Attorney General Letitia James said.
According to Attorney General James, debt collection companies added $ 200 to debts purchased and placed for collection. Collectors then asked consumers to pay thousands of dollars that they didn’t legally owe. The settlement also alleges that collectors told consumers they would be arrested for check fraud. Collectors would spoof calls and make it look like government agencies were calling consumers.
“There is no tolerance for individuals who use illegal and unreasonable tactics to deceive consumers about their hard-earned money,” Attorney General Letitia James said. “Not only did the defendants force consumers to pay more than they owed, they falsely threatened to arrest consumers for not complying with these predatory practices. This regulation demonstrates our commitment to protect consumers and I thank the CFPB for its partnership to put an end to this exploitation scheme.
The regulations prohibit MacKinnon, Gray and their businesses from engaging in debt collection.
MacKinnon lawyer Dennis Vacco released this statement:
Our clients have entered into a Stipulation accepting the entry of a $ 60 million judgment. The $ 60 million represents the total amount of damages the government is claiming in the litigation. Once the court accepts the Stipulation and delivers the judgment, the government will have to initiate a separate process to enforce the judgment.
Mr. MacKinnon wanted to put this case behind him and avoid the ongoing costs of litigation and allow him to turn to other business interests. He was not required to pay any money at that time in accordance with the terms of the Stipulation.
Joseph Makowski, an attorney for Gray, said his client had “no admission of liability”, was “satisfied with the settlement” and “looks forward to continuing with his family.”