Posts Tagged ‘Mann Bracken’
Debt Collector Mann Bracken Closes Doors
On Thursday, Jan. 14 debt collection law firm Mann Bracken, which had been one of the biggest debt-collection firms in the country, closed its 24 offices with little public warning, according to the Baltimore Sun. State financial regulators had revoked their license. And last week, a Maryland judge ordered that tens of thousands of debt-collection lawsuits involving the firm be dismissed.
Mann Bracken principals issued a statement to the Sun that the firm had “no alternative but to wind down” in light of the November bankruptcy filing of Axiant, a company that worked with Mann Bracken to collect debt. “Axiant’s pending liquidation has left Mann Bracken without funds to pay creditors and insolvent,” the statement said.
Axiant had provided Mann Bracken with various logistics such as phone, computer, staffing and support services before filing for bankruptcy in November. The weight of Axiant’s downfall as well as opposition from those targeted by debt collection litigation was too high a cost for the law firm to survive. It got so bad that at one point there was a complete breakdown at Mann Bracken’s Atlanta office with no one to even answer the phone. From all appearances, the falling of this large collection firm is a sign that Goliaths of the debt collection industry can be brought down.
There had been close relationship between Mann Bracken, Axiant, and the National Arbitration Forum, an arbitration firm that has been criticized for favoring credit card companies in debt-collection arbitrations filed against consumers. In 2006, the article noted, Mann Bracken and another law firm it acquired filed almost 60% of the 214,000 consumer-debt arbitrations before the NAF.
The Minnesota attorney general’s office, meanwhile, filed suit last year against NAF claiming it failed to disclose its conflicting financial affiliation with Axiant and Mann Bracken.
Here’s a blog post giving a typical scenario:
October 2008: “Mann Bracken placed a restraint on my checking account, causing checks to bounce and legal fee’s to grow each month. They got a bogus judgment stating that I was served to appear in court. They claimed to have left the summons with a relative of mine, however that relative doesn’t even exist, and the house they supposedly served was boarded up and abandoned. Also, the money they were trying to collect was from a default credit card, which was proven to be fraudulent and so I am not responsible for that debt. I have paper proof from all three credit agencies to back that up also.
It gets better! On December 29, 2009, FIA Card Services (formerly MBNA) filed a cross-complaint against Mann Bracken, in a case brought against FIA, Mann Bracken and others by the San Francisco city attorney alleging professional negligence and breach of fiduciary duty against the law firm. The cross-complaint unambiguously states:
Another factor contributing to the demise of Axiant/Mann Bracken is the high level of abuse resulting in a public outbreak of protest through calls and letters to the Better Business Bureau as well as state regulators which has finally led to sanctions at the state level. Furthermore, there are growing numbers people who are figuring out the fraud, challenging debt collection lawsuits, and beating them. The cumulative result in this scenario was financial failure. However, there is still a long way to go because most Americans have not yet learned their rights or the real nature of bank-created debt. However, this too can change.
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