Midland Funding LLC Sued for Alleged Robo-signed Affidavits

Debt collection lawsuits are frequent in the current economy. Midland Funding, LLC, one of the country’s largest debt buyers, was sued yesterday by the Minnesota Attorney General Lori Swanson.

Swanson alleges that the company has defrauded Minnesota courts by filing false and deceptive affidavits—affidavits signed by “robo-signers.”

The “robo-signer” problem

Midland Funding is a debt buyer—they buy old debts and try to collect on them. In many cases, affidavits play a critical role in these cases. Employees of Midland Funding submit affidavits with a variety of assertions—but generally focused on establishing an individual owns a certain account and owes a debt.

When an employee of Midland signs an affidavit, they are making sworn assertions based on personal knowledge that a person owes a debt. That affidavit is then entered into evidence as proof of the alleged debt. In many cases, it is the strongest evidence of an alleged debt.

In a recent case in Ohio, an employee of Midland admitted to signing over 400 affidavits a day. It is hard to believe that an individual could sign 400 affidavits a day based on personal knowledge. Frankly, it is hard to believe one person could even read 400 affidavits a day before signing them.

Given that Midland has filed over 15,000 cases in Minnesota since 2008, the robo-signer issue has a major impact on Minnesota consumers.

What to do if you have been sued by a debt buyer

If you received a summons and complaint from a company you have never heard of, you may have been sued by a debt buyer.

If you live in Minnesota, you need to serve a response (called an answer) to the complaint within 20 days of being served. If you do not respond to the summons and complaint, the other side can pursue a default judgment–which means your case would be over before it even begins.

If you would like assistance preparing an answer, or if you would like legal assistance with your case, please contact me.

(photo: http://www.flickr.com/photos/justkristin/198630375/)