Debt Collector To Clean Up Business Practices

Attorney General Spitzer today announced an agreement with a Western New York debt collection company.

Creditors Interchange, Inc. of Cheektowaga agreed to significantly reform its business practices and pay $60,000 in civil penalties and costs to the state.

"This agreement sends a message that my office will act to protect consumers from illegal debt collection practices," Spitzer said.

Since 2001, Spitzer's office has received approximately 80 complaints from consumers
regarding Creditors Interchange's collection efforts. Some complained that Creditor's Interchange discussed debt with employers and family members, and failed to expeditiously verify a consumer's debt as required by law when requested to do so by the consumer. Others complained that Creditors Interchange violated federal law which requires a debt collector to cease contact with a consumer after the consumer demands it do so.

As a result of the inquiry with Spitzer's office, Creditor's Interchange has already implemented a series of significant reforms to prevent against future violations. These reforms include:

• Enacting a zero-tolerance policy for violations of federal and state laws;
• Establishing a compliance committee consisting of senior management from the Departments of Compliance, Collections and Human Resources which will convene once per month and review all complaints and disciplinary actions;
• Monitoring and recording collectors' phone calls to protect against illegal conduct; and
• Maintaining an enhanced "incident log" to provide detailed information to track the handling of complaints which will be reviewed by senior management.

Individuals with complaints or questions about debt collection practices are encouraged to contact the Attorney General's consumer help line at (800) 771-7755.

The case was handled by Assistant Attorney General Dennis Rosen and Senior Investigator Peter Eiss of the Buffalo Regional Office.