by: Jim Strickland Updated:
ATLANTA - Lines are being drawn between federal regulators and the Marietta debt collector accused of deceiving consumers.
Consumer investigator Jim Strickland got reaction from both sides on one of the keys to the case.
"I wonder why they filed this lawsuit. I don't think they have the legitimate authority to file the law suit," said former Georgia Attorney General Mike Bowers.
Bowers is defending debt collection law firm Frederick J. Hanna and Associates against civil charges brought by the Consumer Financial Protection Bureau, which paint the Hanna firm as a litigation mill.
Bureau director Richard Cordray put out a statement:
"The Hanna firm relies on deception and faulty evidence...to intimidate (consumers) Into paying debts they may not even owe."
CFPB also accuses Hanna of relying on clerks, charging that actual lawyers spend only a minute working each lawsuit filed against non-paying consumers.
"Both of those are absolutely incorrect, completely, absolutely incorrect," said Bowers.
"The lawyers do spend a good bit of time to make sure (legal filings) are adequate. Are they spending hours on each of these lawsuits? No. Are they spending enough time to make sure they are accurate and proper? Absolutely."
Federal law limits the CFPB's authority to sue licensed law firms. A bureau spokesperson says Hanna is different.
" ... the legal exemptions that, in certain circumstances, shield attorneys from the bureau's enforcement authority do not apply to lawyers who are not actually providing legal services to the harmed consumers..," read the statement in part.
"Baloney," reacted Bowers when Strickland read the statement.
Bowers says he will vigorously defend Hanna's right to practice law and his right to use the courts to make those that owe pay up.
"It's Hanna's job is to make sure someone pays his bills, and part of that is to make sure other
people don't have to pay someone else's bills," he said.
Hanna is being investigated by the State Bar of Georgia, which Bowers says in the only body, acting for the Supreme Court, truly authorized to regulate a law firm.