Security Credit Services collecting old debt.
I owned a small business in southern California. After nearly 15 years, it went belly-up in January 2008 through no fault of mine. (Our landlord got into financial difficulty, locked us out without any warning, seized our assets, and decamped.) The company had a number of loans, lines of credit, and credit cards with outstanding balances, and there were not enough assets to pay them all off. I consulted an attorney who told me that unless I had signed a personal guarantee, I had no personal liability for any corporate debt.
One of these was a line of credit with an outstanding balance of more than $98,000. The bank involved quickly realized there was a problem when they didn't receive the regular monthly payment, and promptly had a law firm contact me (fancy, embossed stationery, etc) informing me I was liable and demanding payment in full. I immediately faxed a request to the law firm for a true copy of the loan docs, including the document in which I agreed to be a personal guarantor. I never heard another peep. Not only had I not signed a personal guarantee, but the bank had never bothered to get any loan docs executed by anyone at my company -- there wasn't even a written application for the loan.
The debt went through the usual cycle of collection agencies trying various unethical and/or illegal maneuvers to try to coerce me into paying. I've long since stopped answering my phone, sigh.
There has never been any mention of this loan on my Experian report up to and through 2013. However, when I recently pulled a copy of my Experian report, it showed that Security Credit Services LLC (Oxford MS) had opened an account for this loan on my personal report in March 2014, claiming I was a "co-signer", and had been reporting it as "past due as of Jan 2013" since the following month (04/2014). Experian notes that the account is scheduled to continue on record until May 2015.
Security Credit Services never contacted me regarding this matter. They may have tried calling, but never managed to speak to me. They have never sent anything in writing.
And... A different bank -- USBank -- had issued a corporate credit card. There was an outstanding balance around $3,000 when my company went belly-up, and USBank could not produce any paperwork associated with the card. They promptly turned it over to a collection agency, and it's gone through half-a-dozen more since mid-2008. I faithfully sent "either validate or cease-and-desist" letters to each one, the most recent being in March 2012.
Security Credit Services was apparently the next to "inherit" the debt, and opened an account on my report, again with the claim that I was a co-signer. When I found this on my report in Jan 2013, I disputed it. Experian informed me that Security Credit Services insisted that the debt was mine and refused to delete it from my report. I spoke with an Experian rep who was sympathetic, but didn't have a clue what I should do. She said the banks and collection agencies are not required to send any sort of proof when and if someone disputes a purported debt. This particular report was due to continue on record until February 2015. I have not yet pulled a copy of my report this year to see what it says, since I'm waiting until the much larger loan debt is due to "expire".
In June 2014, Michael Haynes & Associates started harassing me with threatening voice mail messages. The first was from "Jacob Schwartz" who said he was "preparing a civil complaint" for a client of his firm "that is attached to your name and SSN" and will be filed in in county court where I live. He wanted to give me the details of the complaint "before it is released" and I was to call him ASAP at 305-438-6321. That's in Miami. I'm in California. I found complaints of similar messages on the web, confirming my suspicion this was a collection agency. I ignored it. The next message came a month later, from "James White" with a San Antonio phone number. "We have made several attempts to reach out to you regarding a civil complaint that has been filed against your name/SSN. If you have any intention of being made aware of this situation or resolving it prior to litigation, call my office. My direct line is 210-272-9317." In September, they called my house at 6:14am. Three days later, I was expecting an important call and answered my phone. The ... person ... identified himself as being with Haynes & Associates. I said, "Don't ever call here again" and hung up. He redialed every time he heard the answering machine for at least 20 minutes. (Mercy, such a temper.) No one from Haynes & Associates ever identified themselves as a collection agency, and they never attempted to contact me in writing ... until now.
Yesterday, I received a letter from "Oxford Law, LLC", claiming to represent Michael Haynes & Associates, the "current creditor" for the USBank credit card (which is now supposedly at $4,428). At least these yahoos admitted they were attempting to collect a debt.
This is really getting old. I don't plan on responding to Oxford -- unless you recommend otherwise -- because the purported debt will simply move on down the line, and who knows what offensive jerk will be next. However, I would appreciate knowing what, if anything, I can and should do about Security Credit Services. I do not appreciate having debt reported on my credit report when I am not liable, and especially when Security Credit Services opened the accounts on my Experian credit report after the Statute of Limitations was past (it's 4 years in California.) Since it will no longer be on my record as of next month, should I just ignore it? Does the fact that it was on my report, even so briefly, affect my future credit score?
You did a fantastic job navigating all of the old debts for the business.
Security Credit Services is a debt buyer with a past, and a recent one at that. Given some of the back story you have shared, and how Security Credit placed erroneous collections on your credit reports, they are still struggling to find their way with best practices….
Debt collectors hired by Security Credit Services.
Many debt buyers, like Security Credit services, do not do all their own collecting. They farm out the collection work to third party collection agencies and law firms. For this reason, it is not a surprise you did not hear from them.
The Michael Haynes & Associates collection calls may be a debt collection scam that is not related to Security Credit Services. But judging from the debt buyer with a past outline with the FTC, they could have sent your account to a debt collector willing to make empty threats about “preparing a civil complaint” that were never going to happen.
Read through that debt collector scam piece for more about how to handle anything more with Haynes & Associates, and perhaps Oxford Law as well. You may want to run this whole scenario by an experienced fair debt lawyer. I can refer you to someone you can speak to at no charge, and if they think you have a strong FDCPA case, will often take the file on at no cost to you. Let me know in a comment reply below.
If it were me, I would indeed send the new debt collector, Oxford Law, a written dispute and cease communication letter via certified mail, and return receipt requested.
Security Credit Services on your credit reports.
Here we are with your commendable patience again. The debts never appeared on your personal credit reports when they were current, nor after you defaulted with payments after the business folded up. Not until Security Credit Services purchased your debt did any collection derogatory show up on your credit reports.
If it were me, and even though there is only a month to go before the last known date for Security Credit to be deleted from your credit, I would send debt collection and credit reporting complaints to the CFPB.
Why do I suggest this course:
- The accounts should have never been on there to begin with.
- The CFPB will look into the matter and help to resolve it where possible.
- They track bad debt collector behavior and;
- Curate a complaint database that will go public in a few months (bad practices can be exposed with the bad actors visible to the public)
- Care about collection violations and would like to be aware who may be harming consumers so that they can be targeted for investigation.
- Are preparing to make debt collection rule changes this year, and the information would be helpful for them to have.
You can of course wait the credit reporting out, but you really would be helping others by getting the facts of your situation in the hands of people that can really use the information. And of course, you should not hesitate for a moment if you look on your credit reports today and find the USbank collection still on there, or look in June and find Security Credit Services on any of your credit reports.
I doubt the fact that Security Credit Services having ever appeared on your credit reports will impair you going forward when they are removed. If you are ever denied credit, be sure to ask for a copy of the actual report that was used to decline you.
We can continue the conversation in the comments below. Anyone with questions or concerns about Security Credit Services is welcome to post in the comments for feedback.