Lois Bowers reported on debt collection in assisted living facilities for McKnight’s Senior Living.  A company and its owner that collect debt on behalf of assisted living communities have been sued by the federal Consumer Financial Protection Bureau and accused of collecting debts without a “reasonable basis to assert that … consumers owed those debts.” FCO Holding and its subsidiaries, as well as owner and CEO Michael Sobota, are named defendants.

FCO and Sobota, according to the CFPB, operate “the largest debt-collection company in the multiunit-housing industry,” also collecting debts on behalf of student and military housing in addition to senior living facilities.

The government’s civil complaint alleges that did not maintain “reasonable policies and procedures” to ensure the accuracy of the information it “routinely furnishes” to credit-reporting agencies Equifax, Experian and TransUnion, including the handling of consumer disputes, as required by law.

“FCO has failed to conduct reasonable investigations of certain consumer disputes and has failed to cease furnishing information that was alleged to have been the result of identity theft before it made any determination of whether the information was accurate,” the complaint states. “In addition, FCO and Sobota have collected debt without a reasonable basis to assert it was owed.”

The lawsuit maintains that FCO violated the Fair Credit Reporting Act, Regulation V and the Consumer Financial Protection Act as well as the Fair Debt Collection Practices Act. The bureau is seeking an injunction as well as damages, redress, disgorgement of ill-gotten gains and the imposition of a civil money penalty.

FCO Holding and its subsidiaries — Fair Collections & Outsourcing, Fair Collections & Outsourcing of New England and FCO Worldwide — operate collectively under the name Fair Collections & Outsourcing and FCO, according to the CFPB.

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