Hiding in Plain Sight: How PRA Group, Incorporated Created a Phantom Fortune from Worthless Debt
Thank you to my anonymous muse who taught me that finishing a book is not that hard. And thank you to FeFe Ford, whose encouraging comments revived my faith that my blog posts can change policy and even lives.
I don’t like to toot my own horn. But I’m going to. (Do you notice that when someone says, “I don’t want to say this”, they usually say it?)
A subsidiary of publicly traded PRA Group, Inc. told a whole bunch of lies about me and I had to go back to 2010 searching for the truth. Here is an email I found that was sent to me on the day subsidiary Portfolio Recovery Associates, LLC’s attorneys certified under FRCP Rule 11 that I was getting myself into debt that I could not get myself out of. (Ironically, I was never sued for an unpaid credit card debt nor filed bankruptcy, but Attorney James Trefil, lead liar for PRA, filed for bankruptcy.)
Dear Ms. Lynn,
I sat for a few moments yesterday reading an article I just happened upon that you had written about a man that entered mine and my two daughter lives about five long years ago and we were changed in such a negative way that our world would never be the same. I couldn’t believe my eyes as I was reading about the wrecker who has done so much damage to our family and tears seemed to leak out of my eyes and began to roll down my cheeks and I felt a kind of sorrow because I hadn’t found this site earlier, but at the same time a weight seemed to lift from within me. This must sound strange to you and very emotional but I feel this way because it kind of sounds like the monsters in the closets are about to be exposed? You must already have heard so many unbelievable accounts of what Mr. Bill [Attorney William Spillar, Jr.] and his entourage has done and are capable of I’m sure. I hope with all my heart and soul that what is right and fair happens to the wicked players in that family law court (Torrance Superior Family Law Dept J) as they are exposed for whom and what they really are and all the damage did to so many children and parents. If you ever want our account of what happened to us please don’t hesitate to ask via email. Keep up the good work and let me know if I can be of any help. Thank You!
Bird
The fight against unethical and arguably illegal activity of debt collectors is not as heart wrenching as trying to reunite children with their loving parents. But many of the ills that befall those parents are economic. The destruction of their careers, mental health and credit make it difficult to afford already prohibitive legal fees and the distraught parents are forced to challenge pedigreed and unethical lawyers through self-representation.
The next book I am writing is titled “Hiding in Plain Sight: How PRA Group, Incorporated Created a Phantom Fortune from Worthless Debt”.
Please contribute to my effort by emailing file stamped copies of litigation documents involving Portfolio Recovery Associates or any other PRA Group subsidiary to TheNext55Years@gmail.com. The email I used for the California family court communications was bohemian_books@yahoo.com. My intention when I created the gmail account was to leave my stressful past behind. Tell God your plans…lol.
Snail mail can be sent to Laura Hammett, 16 Gold Lake Club Road, Conway, Arkansas, 72032.
Portfolio Recovery Associates’ Attorneys Are Sharks
“Balls of Crystal and Steel: What it Takes to Play Poker Without Losing Your Assets”, the book I co-authored with my son Sean Lynn, is available on Amazon. It is a fun anecdotal romp through the mind of a poker genius (my son) and a nitty old lady (me).
Y’all probably know poker is a passion with me. It puts me in a meditative state and calms my soul.
In poker, amateurs are called “fish” and those that eat them up are called “sharks”.
Sean is a shark.
Here is an excerpt from one of the stories he contributed:
“This old man is really lost, he just decided to take up poker and is here playing 1/3 no limit because there isn’t a 2/4 fixed limit anywhere around. He brings a little cheat sheet to the casino every time that has the hand rankings on it; straight flush at the top, then quads, three of a kind, two pair. As confusing as it is to remember if trips beats a straight or not, if he really doesn’t have that stuff memorized I know he doesn’t know the odds of anything.”
One of my stories that did not make it into Balls was about my first trip to a card room. It was in Commerce, California. Sean brought me.
As we walked through the parking lot, I asked him again, “so, two pairs beats what? What if I have a straight and someone else has a full house?”
“Mom…”, exasperated, “look at your two cards and say ‘fold’. Unless you look at your two cards and see two aces. Then say ‘all in’ and push all your chips forward.”
My play really hasn’t changed much from that night.
Lawyers for debt buyer Portfolio Recovery Associates, LLC are the sharks of law. The lawyers I am up against on my FDCPA, invasion of privacy and outrage case against PRA Group, Inc’s subsidiary are from Rose Law Firm and Troutman Sanders, LLP. Plus PRA has an inhouse litigation team hundreds strong.
I need a cheat sheet for everything I do in court.
SPOILER ALERT: The old man won the hand against Sean. It was crazy. You’ve got to read the whole chapter.
The title: When you’re ahead, you’re ahead.*
Buy the book here.
*You may still lose if the dealer looks at your royal flush and says you mucked your cards. Then you have to go to the pit boss and then the Gaming Commission and hope for the right thing to be done.
Trial that Led to $83 Million Verdict Against Portfolio Recovery Associates, LLC Because of Abusive Litigation
You: Portfolio Recovery Associates called me over and over again about a debt I did not owe.
You: I owed a debt on a credit card and Portfolio Recovery called me incessantly because I refused to talk to them.
You: How do I make PRA stop calling me?
There is a law that is supposed to protect people from abusive debt collection practices. It is called the FDCPA and is codified as 15 USC 1692.
I say supposed to, because there are judges, such as Lee P. Rudofsky in the Federal District Court of Eastern Arkansas who determine what is “abusive”, “invasive” or “outrageous” without letting a jury decide.
There are other judges, such as Joel P. Fahnestock, a circuit court judge in Missouri who allowed an FDCPA case to proceed to a jury trial over the issue of damages. Judge Fahnestock made the decision that Portfolio Recovery Associates, LLC violated the FDCPA as a discovery sanction. The judge did not appreciate how PRA was evasive during the FDCPA litigation discovery.
If you have a potential FDCPA case against a debt buyer, and your experience is like mine, the majority of attorneys will advise you to take the $1,000 or $5,000 settlement offer proffered by the billion-dollar company.
I decided to take PRA on myself, pro se. I want a jury to decide what punitive damages should be charged to deter Portfolio Recovery from continuing conduct that I and the CFPB find abusive.
The Goliath company that has hundreds of in-house litigation employees and hires firms such as Rose Law, of Hillary Clinton fame, fights dirty. They lie in court.
My fight is getting easier as I collect documents from prior cases against the debt collector. Hopefully you come across this blog early in your proceedings and can be guided by the work of a few excellent attorneys who didn’t go along with the PRA program.
Here is the entire transcript of a trial for which an $83,000,000 verdict was awarded against Portfolio Recovery Associates, LLC.
(PRA appealed, then reached a settlement before the appellate court made a decision.)
Top Secret: Hearing in Front of Judge Lee P. Rudofsky May Be.
Federal District Court Judge Lee P. Rudofsky has agreed to hold a hearing to discuss the pending motions for summary judgment and reconsideration of an earlier order granting summary judgement in Hammett v. Portfolio Recovery Associates, LLC and Does on May 23, 2023 at 9 a.m. Central time. [UPDATE: Hearing Continued]
The hearing is by telephone and I made an inquiry of the Judge’s clerk as to whether I may share the access code with the public. Sorry, no response yet, but you will be the second to know.
The hearing should be interesting. I hope to discuss the as yet unsigned Consent Order filed March 23, 2023 between PRA and the CFPB [UPDATE. The Order was signed April 16, 2023]; new caselaw that finds that destroying evidence such as business records, even before a lawsuit is filed if the evidence can be expected to be used for litigation, carries the negative inference that is associated with spoliation of evidence; and the $82M punitive damage award against Portfolio Recovery for doing a similar thing to a woman in Missouri.
I may not have time to file a motion for clarification as to whether the hearing can be accessed by the public. The clerk still did not respond to my email inquiry. Sorry.
If you want the access code, please ask the court.
How Many Reasons do Courts Have to Show Favoritism to Debt Buyers? About a Hundred Million Reasons.
Old credit card debt is often sold to a junk debt buyer for pennies on the dollar. The debt buyer makes approximately 30% of its revenue from alleged debt collected through legal proceedings. A vice president for one of the most active debt buyers in the nation, Portfolio Recovery Associates, LLC, said of the judgements obtained, 90% are by default.
Some of the no shows owe the debt. But many cannot take off work, don’t understand the process, do not actually receive a summons, or may even be dead.
But PRA is notorious for bringing actions against alleged debtors on debt that cannot be verified, and even worse, that PRA knows is from inaccurate records. The majority of the time that an alleged debtor shows up to court, the case is dismissed. Ooops, says PRA, my bad.
Why do the judges not require the unopposed debt buyer to show at least a minimal amount of old account level documentation that shows when debt was supposedly incurred and where? This is as simple as showing the account statements from the last time the account was zero until it was at the current balance.
The judge would not need to look at every entry. A spattering would do.
Call me a cynic. I think the courts like the income from the litigious collectors.
Portfolio Recovery Associates is a wholly owned subsidiary of PRA Group, Inc, a publicly traded company that has the symbol PRAA.
In PRA Group’s consolidated financial statement for 2021, Total Portfolio Revenue shows as $1,073,231,000. Of that, $78.3 million was “costs paid to courts where a lawsuit is filed for the purpose of attempting to collect on an account.” In 2020, the costs paid to courts was over $100,000,000, about 9% of revenue.
I’m not saying a debt buyer walks into a judge’s chambers with a briefcase full of cash and walks out empty handed.
I’m just wondering if the courts would put a little more consideration into their decisions if it was the alleged debtor who kept the court lights on and paid the staff’s salaries.
A Little Light Reading for Your Sunday Evening
Atheists call it “coincidence” or “kismet”. I call it a God thing.
God is good, all the time.
So, I was pulling up caselaw on Thursday at the Arkansas Supreme Court Library. They let patrons use their Westlaw subscription. There is an email function. This is a pro se litigant’s lifeblood.
Praise break: The staff at the library is great. Especially Ava. She and the rest of the crew go out of their way to help dig for the truth.
The wind finally calmed down this evening and I got a walk in. Then I sat down to read the emails from Thursday.
The first email from Westlaw was a case out of Massachusetts. The case discussed was the end of a line of dicta and persuasive law that I will use in my case against the greedy and obnoxious debt buyer, Portfolio Recovery Associates, LLC.
Once you learn the legal shorthand and style preferred by the courts, caselaw is so interesting. I may never read fiction again. (Though I am coming to find that much of what judges write is fiction also. Hint: Judge Susan Kaye Weaver, Judge Billy Roy Wilson, etc.)
I asked a therapist once if she thought I am litigious. She said no. She explained that because I had to protect important rights in court once, I learned about other rights and just try to protect them also. One case teaches me that I have another case.
Thus, I read a case to glean what I can about the Portfolio Recovery dispute, and it is as if this learned judge in Massachusetts is sitting with me, chatting about the Pietrczak and Shelter Insurance cases presided over by Judge Weaver. Here is what Judge Angel Kelley told me: (I did not make this up; her name really is Angel.)
“But Lotus Foods’ interests in this case are ‘aligned closely enough’ to Zhuang’s that the company’s interests elsewhere will be adequately protected by Zhuang’s positions here. Merrill Lynch, 11 F.4th at 17 (‘We have explained that where the interests of an absent party are aligned closely enough with the interests of an existing party, and where the existing party pursues those interests in the course of the litigation, the absent party is not required under Rule 19.’); see Pujol v. Shearson Am. Express, Inc., 877 F.2d 32, 135-36 (1st Cir. 1989) (‘The mere fact … that Party A, in a suit against Party B, intends to introduce evidence that will indicate that a non-party, C, behaved improperly does not, by itself, make C a necessary party.’). Although Zhuang bears the burden to show that Lotus Foods should be joined, he fails to demonstrate why his own defense—ostensibly, that he did not commit fraud, intentionally interfere with New Ming’s business relations, or convert New Ming’s funds—will not protect Lotus Foods’ interests as well. Roy v. FedEx Ground Package System, Inc., No. 3:17-30116-KAR, 2020WL3799203, at*6-7(D. Mass. July 7,2020) (”'[A]n absent party’s interests cannot be harmed or impaired if they are identical to those of a present party.”‘ (quoting Bacardí, 719 F.3d at 11) (internal alternations omitted)). Presumably, the two would want to prove the same things. None of the cases defendant cites demonstrate that a corporate entity must be joined if one of its officers or directors issued individually for tortious conduct. Cf. Rivera Rojas v. Loewen Group Intern., Inc., 178 F.R.D.356,361-62(D.P.R. 1998) (finding subsidiary necessary party in contract dispute against parent company); Urquhart v. Wertheimer, 646 F. Supp. 2d 210, 213(D.Mass.2009) (finding partnership necessary and indispensable party where (i) plaintiff’s claims were derivative, and (ii) the general partner’s and the partnership’s interests were not aligned). Taking New Ming’s allegations as true, Lotus Foods is not necessary under Rule 19(a), and the court need not address Rule 19(b) at this time.”
Thank you, Judge Kelley. Can I pour you a glass of Moscato or do you prefer a cup of dandelion tea?
Judge Silly Sue Weaver demanded that I join my own living trust, of which I was sole trustee and non-contingent beneficiary, to a case against Shelter Insurance Company and Jeff Jennings Insurance. No attorney would represent the trust, because it would be professional suicide. The trust held no liquid assets, anyhow, so the trust would need to obtain funds for an attorney from me. I named the trust as a defendant, arguing that I paid for the insurance out of my individual funds, and will be harmed by the trust’s inability to retain counsel. I told the court that she was free to name the trust as an involuntary plaintiff.
While on another case Judge Silly Sue said I could not defend myself as an individual during a hearing to determine the amount of default damages awarded against the very same trust. After the kangaroo court hearing Judge Weaver dismissed me as an individual with prejudice. Then she went on to decide I personally did some illegal things. She gave the real property held in trust, my individual rights to use that property and my personal property that was on the real estate to a man who had sued me maliciously, twice, and had the case against me dismissed both times.
The Pietrczak case is on appeal and the Shelter insurance case will certainly need to be appealed, also. Hopefully, someday, an old lady or a modest means family that is fighting to keep the little they have will come across the writings of the Arkansas Court of Appeals on my cases and be able to say, “Praise God”. We can pray.
Spoliation and Cover-up by Portfolio Recovery Associates and Judge Lee P. Rudofsky
The jury is still out, so to speak, on the motivations for Trump appointed judge Lee P. Rudofsky to allow for Portfolio Recovery Associates to deem so much evidence in my case against them as “confidential”, and worse, to allow the evidence to be filed under seal. Turning the case into a Star Chamber is probably legal error. It definitely flies in the face of our Founding Father’s stated intent to give justice to all through a transparent legal system.
For fear of violating a court order, my report will lack my usual detail of the evidence. I feel comfortable telling you what is not in the sealed evidence.
Basic background: My claim is that the Goliath debt collector violated the FDCPA. Portfolio Recovery Associates,LLC is a wholly owned subsidiary of publicly traded PRA Group, Inc. I had no outstanding debt to them or the original creditor. PRA changed the balance on my account to zero, but only after I filed litigation against them. The FDCPA is a strict liability statute and I have a right to allow a jury to decide what the damages are. Instead of proceeding to trial, PRA filed a motion for summary judgment. The Court agreed to dismiss the majority of my claims based upon the evidence presented to the court, claiming no reasonable juror could find otherwise. Judge Rudofsky did allow me to proceed on one issue and a motion for reconsideration of the other issues, but did not allow me to discuss the evidence or lack of evidence openly with the public. This is concerning, since I showed the Federalist Society judge copies of similar evidence filed in other PRA cases.
I contend that some of the evidence is inconsistent and the company records have been altered.
Usually in a lawsuit, when one party starts shredding the evidence, the court will impose sanctions against them. But, up until recently, many courts opined that the spoliation must take place after litigation is filed. A wise appellate court justice in Massachusetts recently found how illogical this was and made the following order:
“Notice of docket entry received from Appeals Court Please take note that on January 30, 2023, the following entry was made on the docket of the above-referenced case: ORDER (RE #1): The plaintiffs JFF Cecilia LLC and Suffolk Construction Co., Inc. seek interlocutory review pursuant to G.L. c. 231, s. 118 (par. 1) of a January 6, 2023 order issued by a judge in the Business Litigation Session of the Suffolk Superior Court denying their motion for spoliation sanctions against the defendants Weiner Ventures LLC, and Stephen and Adam Weiner. As relief, the plaintiffs request that the single justice reverse the order or authorize the taking of an interlocutory appeal to a panel. ‘The doctrine of spoliation permits the imposition of sanctions and remedies where a litigant or its expert negligently or intentionally loses or destroys evidence that the litigant (or expert) knows or reasonably should know might be relevant to a possible action, even when the spoliation occurs before an action has been commenced.’ Scott v. Garfield, 454 Mass. 790, 798 (2009). Because the decision denying the motion notes the correct standard and also states that the ‘potential litigation must be probable . . . and not merely possible,’ and that the Weiners did not have an obligation to preserve evidence because ‘[a] reasonable person in the same position would, at that point, not think it very likely that they would be sued,’ I cannot tell if the judge applied the correct standard. Accordingly, the matter is remanded for the judge to determine if the defendants knew or reasonably should have known that evidence might have been relevant to a possible action. If the judge determines that the defendants spoliated evidence, they should then determine if it prejudiced the defendant. If so, they should determine if sanctions are appropriate. The order after remand is requested to be transmitted to this court within 30 days at MACClerkMatter@jud.state.ma.us. I also note that the plaintiffs request that they be permitted to present evidence of defendants’ alleged spoliation to the jury. I note that even where a judge denies a party’s motion for sanctions for spoliation, a plaintiff alleging spoliation is ‘free to argue that a trier of fact should hold the [defendant’s] failure to return [the documents] against the [defendant].’ Zaleskas v. Brigham & Women’s Hosp., 97 Mass. App. Ct. 55, 76 (2020). (Henry, J.) *Notice/attest/Salinger, J.”
Why have so many of the thousands of attorneys who have filed FDCPA cases against Portfolio Recovery Associates LLC and other junk debt buyers failed to question the practice of credit card companies and their successors of destroying the record before it is needed for litigation, even though there is a good probability that the documents will be needed?
In the cases connected to the collection of debt that are brought by the debt collectors, which vastly outnumber the cases against the debt collectors, the debt collector is tasked with producing enough documentation to verify the debt. Unfortunately judges like Lee P. Rudofsky hold the alleged debtor responsible for proving that the debt was either a clerical error or a fraudulent transaction, even though the old account level documentation was destroyed by the original creditor or its successors, and the statute of limitations for being sued on the debt has expired.
In my case, Portfolio Recovery took their destruction of evidence a step further. The records produced are not consistent. It is clear. A person of limited intelligence can look at one document and see that an event was documented and look at another document that covers the same time period and see that there is no indication of the same event.
Someone who has way too much time on their hands can look at my request for production of documents and see that certain documents requested were not produced on the open record. One of these is the company policy manuals. The public cannot look through my case file and learn what Portfolio Recovery Associates policies and procedures are. The public will not know from this case whether or not PRA representatives are required to log each time they make a phone call or not. The public will not know from this case whether or not PRA complies with 26 CFR section 1.6050P by issuing a 1099-C whenever it cancels debt, heeding the warning found in the IRS instructions, “Do not file Form 1099-C when fraudulent debt is canceled due to identity theft. Form 1099-C is to be used only for cancellations of debts for which the debtor actually incurred the underlying debt.”
PRA attorney from the firm of Troutman Sanders, LLP said in open court that PRA did not issue a 1099-C to me “in light of the litigation” but that should not be admissible as evidence because lawyers’ statements are not testimony. Because Judge Rudofsky hid most of the evidence from public scrutiny, when I report to the IRS, I can only tell them what happened to me, not what is in the record. That I did not receive a 1099-C ever in my life, but I had lawyers for Portfolio Recovery Associates LLC say there was a valid, not fraudulent debt and PRA waived it. Oh, and they waived it without including their largesse as part of a settlement.
A Higher Law 