Security Credit Services or SCS is an accounts receivable, acquisitions, and management firm based in Mississippi that specializes in purchasing delinquent debt from banks, retailers, and other lenders. SCS has received consumer complaints alleging violations of the Fair Debt Collections Practices Act (FDCPA), including attempting to collect debts not owed and failure to provide verification of debts. If you have been contacted by Security Credit Services, make sure you understand your rights before responding.
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Is Security Credit Services a scam?
According to the Better Business Bureau (BBB), Security Credit Services, LLC was founded and incorporated in 2003 in Oxford, MS and is registered as a debt relief services company. The BBB opened its file in 2008.
According to its website, SCS “purchases very specific types of delinquent and charged-off consumer portfolios. [SCS] purchase[s] accounts that were recently charged off, as well as warehoused accounts that have been sitting idle for years, and anything in between.” In addition, SCS “buys, sells, and manages 3rd party agencies and law firms to collect nearly $1 billion of delinquent accounts receivables from the nation’s most respected creditors.”
Unlike most collection agencies that focus on profits generated from recovering delinquencies, SCS “raises funds from individual accredited investors and wealth management firms to buy delinquent debt for its individual debt purchasing companies.” Prior to assigning purchased debt to third-party agencies for collection, SCS “analyzes each debt portfolio, reviewing more than 180 data points to help determine the correct purchase price to achieve our internal rate of return objectives.”
Security Credit Services places purchased charged-off debt “into nationally licensed and bonded collection channels.” SCS states that the collection agencies and law firms with whom they hold contractual agreements must adhere to the Fair Debt Collection Practices Act. In addition, SCS cites its membership in the Debt Buyers Association (DBA) and the Association of Credit and Collection Professionals (ACA International).
SCS’ website does not contain references or links to consumer protection laws, consumer resources, or details of its regulatory compliance policy.
The BBB has closed 48 complaints against Security Credit Services in the past three years, with 25 complaints closed in the past twelve months. Almost all of these complaints alleged problems with billing and collections. Since December 2015, the Consumer Financial Protection Bureau (CFPB) has closed 39 complaints against SCS. Justialists at least 7cases of civil litigation listing SCS as a defendant.
Absolutely. Here are some Sample Cases against Security Credit Services LLC – SCS
In January 2012, in United States District Court, Southern District of Florida, a judge issued an Order Denying Defendant’s Motion for Summary Judgement in a case alleging violations of the FDCPA and the Florida Consumer Collections Practices Act (FCCPA) by SCS. Initially, this case was filed as a complaint against SCS, who had filed a lawsuit against the plaintiff to collect a delinquent debt it had purchased from the original creditor, Wells Fargo Bank. In this case, the plaintiff alleges that legal actions taken by SCS in relation to the collection of the debt violate both the FDCPA and the FCCPA. Specifically, the plaintiff argued that because Security Credit Services was not registered as a collection agency in the State of Florida at the time of its business activities, its actions violated the FCCPA; furthermore, this FCCPA violation resulted in a violation of FDCPA provisions that prohibit collection agencies form taking legal action they cannot legally take. The judge in this case found that the plaintiff successfully established that the debt was a consumer debt. In addition, SCS had purchased debt that was already delinquent and took action to collect the past due amount; because these actions legally constitute debt collection activity, the plaintiff also successfully established that SCS was acting as a debt collector according to the FDCPA. Next, the plaintiff established as a result that SCS’ conduct violated the FCCPA’s provision that “no person shall engage in business in this state as a consumer collection agency or continue to do business in this state as a consumer collection agency without first registering in accordance with this part, and thereafter maintaining a valid registration.” Security Credit Services tried to counter by arguing regardless of the FCCPA violation, its actions did not violate the FDCPA because it never “threatened to take any action against Plaintiff; it simply took action when it filed its counterclaim.”
The court rejected this argument, noting that it “would be illogical to read the FDCPA to condemn the mere threat to file a lawsuit that could not be legally instituted, but actually permit the filing of illegal lawsuits.” As a result, the “Defendant Security Credit Services, LLC’s Motion for Summary Judgment…[was] DENIED.”
Security Credit Services, LLC
2653 W Oxford Loop, Ste. 108
Oxford, MS 38655-2929
The Fair Debt Collections Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA) are enforced by the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB).
The FDCPA regulates the behavior of collection agencies by prohibiting actions such as the use of abusive or threatening language; harassment; or the use of false or misleading information to collect a debt.
The FCRA regulates how collection agencies and creditors report delinquent debts to credit reporting agencies. Additional consumer protection laws include the Telephone Consumer Protection Act (TCPA) and the Consumer Financial Protection Act (CFPA). The complaint above illustrates how these laws can be extremely effective tools to hold accountable collection agencies who fail to adhere to their provisions.
These laws also provide individuals with a means to seek monetary damages in court. For example, the FDCPA allows consumers who have been violated to recover damages of up to $1,000, plus attorney fees and court costs.
Seek legal assistance to find the relief you may be entitled to if you are having difficulty resolving disputes with a debt collection agency
Your debt harassment checklist:
- You are receiving multiple calls per week from third party collection agencies
- You are receiving early morning or late night calls from debt collectors
- You are receiving calls at work from a debt collection agency
- Debt collectors are calling your friends, neighbors, or coworkers
- Collectors are threatening you with violence, lawsuit, or arrest
- A debt collector attempts to collect more than you owe
- You are being threatened with negative credit reporting
- A debt collector attempts to intimidate you
- Criminal accusations are being made towards you
- Use of obscene language during an attempt to collect
- Automated robocalls are being made to your phone in an attempt to collect
If you’ve been harassed by debt collectors and even one of these has happened to you, we can help. We will fight for your rights.
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