Portfolio Recovery Associates, one of the largest debt collectors in the nation, has agreed to pay $12 million to consumers and a $12 million fine to the Consumer Financial Protection Bureau to resolve allegations of illegal collection practices.
The CFPB settled a laundry list of accusations against the Norfolk, Virginia, company that had first been raised in a 2015 enforcement order, the agency said in a filing in the U.S. District Court for the Eastern District of Virginia on Thursday.
Kevin Stevenson, chief executive of PRA Group, the parent company of Portfolio Recovery Associates, said in a news release that the firm didn't admit to any wrongdoing in agreeing to the settlement.
"We continue to disagree with the CFPB's characterization of our conduct," Stevenson said, but "we are pleased to have this matter resolved and behind us, allowing us to return our full attention to our impactful work with consumers."
The consumers who will be reimbursed represent less than 1% of the company's active accounts, and the settlement isn't expected to have a material impact on the company's financial situation, the release said.
The settlement announced Thursday is in addition to one tied to the 2015 order.
At that time, the CFPB had ordered Portfolio Recovery Associates to pay more than $27 million for filing collection lawsuits against tens of thousands of consumers based on
CFPB Director Rohit Chopra called the company a repeat violator.
"After getting caught red-handed in 2015, Portfolio Recovery Associates continued violating the law through intimidation, deception and illegal debt-collection tactics and lawsuits," Chopra said in a press release. "CFPB orders are not suggestions, and companies cannot ignore them simply because they are large or dominant in the market."
In 2022, Portfolio Recovery reported net income of $117 million on $941.2 million of revenue. Total cash collections were $1.7 billion last year, according to the company.
The CFPB said Portfolio Recovery also failed to properly investigate and resolve consumer disputes about the company's credit reporting. The bureau said the company committed numerous violations of the Fair Credit Reporting Act and Regulation V that implements it, including the failure to inform consumers about the outcome of investigations, resolve disputes in a timely manner and conduct sufficient investigations when a consumer alleged fraud or identity theft.
