Recently I wrote about the Consumer Financial Protection Bureau (“CFPB”) sanctioning Midland Funding and its sister companies Midland Credit Management, Asset Acceptance, and parent company Encore Capital. After a thorough investigation of Midland Funding and the way it collects on debts the CFPB found that –

  • Midland Funding relied on misleading, robo-signed court filings to churn out lawsuits;
  • Midland Funding sued or threatened to sue consumers past the statute of limitations;
  • Midland Funding disregarded or failed to adequately investigate consumers’ disputes;
  • Midland Funding farmed out disputed debts to law firms without forwarding required information.

This is a very brief list of the illegal collection tactics Midland was found to be engaging in.  The CFPB ordered Midland to pay out $42 million in refunds, stop collecting on $125 million in debt, and pay a penalty of $10 million to the CFPB’s Civil Penalty Fund.

You may be thinking, “this is all well and good but what does this do for me in my current debt collection lawsuit with Midland?”

Good question.

What the CFPB Means for Your Arizona Debt Collection Lawsuit with Midland Funding

I recently appealed a judgment entered by one of the justice courts here in Maricopa County.  The justice court had entered judgment in favor of Midland Funding for over $7,000.Evidence Midland Funding Skiba Law Group

On appeal the superior court made reference to the CFPB consent order issued against Midland Funding and went into detail about the collection and litigation abuses that Midland Funding had been found to be engaging in.

Often in debt buyer cases filed by Midland Funding there are significant problems with the documents that are submitted as evidence. Further, Midland always relies on a custodian of records who works for Midland Credit Management to testify about the documents it submits to the court even though very few if any of the documents were actually created by Midland Funding or Midland Credit Management.

Not having a witness from the original creditor creates hearsay problems in that the Midland Credit Management witness does not have any direct knowledge as to how the original creditor kept and maintained its documents.

The easiest way to think of the issues raised by this is imagine that a witness from Company A is called to testify about documents created by Company B.  In order to testify in court about a document the person testifying must have some personal knowledge as to when the document was created, why it was created, and how it was stored.

If the person doesn’t have that knowledge they are said to lack “foundation” and they also run into the problem of hearsay.

In the past Arizona courts have said that if a company incorporated the documents of another company into their own, relied on them in their day-to-day operations, and the documents appeared to be reliable then they could be admitted even if the witness didn’t know exactly how and when the documents were created.

No more.

After going over all of the illegal collection tactics of Midland Funding the superior court made this powerful statement:

“Because of the CFPB Consent Order, Midland Funding is not entitled to any presumption of the reliability of its records.”

Because there is no presumption that Midland’s records are reliable they must then be able to testify as the requirements as to why the document was created, when it was created, and how it was maintained (see Rule 803(6) Arizona Rules of Evidence).  If they can’t do this – and I have never seen a Midland witness who can – then the document doesn’t come into evidence and you should win your case.

If Midland can’t get documents created by the original creditor admitted into evidence it simply can’t prove its case.

How to Get a Copy of the Consumer Financial Protection Consent Order 

Key to being able to use the CFPB Consent Order against Midland Funding is getting it admitted into evidence so that your judge is aware of the findings.

You can obtain download a copy of the Consent Order by clicking HERE.  In getting this document admitted into evidence it is often necessary to get a certified copy of the consent order directly from the CFPB.  You can do this by contacting the CFPB directly and requesting a certified copy.  I did this and was presently surprised at how quickly I received a certified copy in the mail for no charge. You can contact the Consumer Financial Protection Bureau by clicking HERE.

Need Help?

If you need help with fighting Midland Funding over a debt collection lawsuit I would be happy to help you.  I have helped thousands of consumers with their debt problems and would be happy to meet with you to put together a plan on how to fight back!


Schedule a Free Consultation!

John Skiba, Esq. John Skiba, Esq.

We offer a free consultation to discuss your debt problem and help you put together a game plan to eliminate your debt once and for all. Give us a call at (480) 420-4028

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