Consumer Class Action Filed Against Cavalry Portfolio Services Alleging Unlawful Interest Charges
Bailey & Glasser, LLP, filed a consumer class action against Cavalry Portfolio Services, LLC and Cavalry SPV I, LLC, among the nation’s largest debt buyers, on behalf of thousands of Massachusetts consumers. Cavalry buys charged-off debt from credit card companies, usually for pennies on the dollar. The suit alleges that Cavalry illegally assessed retroactive interest on these debts purchased from creditors such as FIA Card Services.
According to the complaint, once a credit card account is “charged off,” the creditor legally gives up its right to apply or collect interest because it stops sending monthly statements. The balance remains the same.
But after Cavalry purchases debts, it goes back and retroactively adds the interest that the creditor waived, causing balances to jump by thousands of dollars overnight. In the case of class representative, this practice added more than $5,000 to the amount of a purchased debt Cavalry was attempting to collect.
The class action suit alleges that Cavalry has no legal right to this interest, and that its practices violate the federal Fair Debt Collection Practices Act and the Massachusetts Unfair and Deceptive Practices Act, Chapter 93A.Contact Form »