Consumer Bureau Action Tracker

CFPB v. Meracord LLC, Linda Remsberg


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Nationwide

target

Meracord LLC, Linda Remsberg

Topics

Enforcement, Debt Relief

In October 2013, the CFPB sued Meracord, a payment processing company, for helping “debt-relief firms impose illegal upfront fees.” Federal law prohibits debt-relief firms from receiving payments before settling any debts, however the CFPB found that Meracord allegedly “processed at least $11 million in unlawful fees” from “more than 11,000 consumers across the country” who were “charged upfront fees.” Meracord was fined $1.3 million and the CFPB would reimburse eligible consumers.

  • In 2013, the CFPB filed a lawsuit against Meracord LLC and Linda Remsberg in US District Court, Western District of Washington at Tacoma. [CFPB v. Meracord LLC and Linda Remsberg, case no. 3:13-cv-05871, filed 10/03/13]
  • In October 2013, the CFPB sued Meracord, a payment processing company, for helping “debt-relief firms impose illegal upfront fees.” When consumers sign up with debt-relief companies, “they are often instructed to stop paying their debts and make monthly payments to a payment processor while the debts are negotiated. Federal law, however, bars debt-relief firms from demanding payments before settling any debts, in order to protect consumers from spending money on services that may not materialize.” According to the CFPB, “Meracord should have known that it was processing upfront payments in violation of the law.”

“In building cases against those companies, the bureau discovered that Meracord had processed at least $11 million in unlawful fees from October 2010 to July 2013. More than 11,000 consumers across the country were charged upfront fees, and nearly 5,000 of them had none of their debts settled. The bureau [planned] to reimburse those consumers using money from its civil penalty fund.”

Meracord was fined $1.3 million. “In addition to the fine, Meracord and its chief executive, Linda Remsberg, are banned for life from processing payments of any kind for providers of debt or mortgage relief.” [Danielle Douglas, “Consumer agency fines payment processor Meracord over debt-relief firms’ illegal fees,” The Washington Post, 10/03/13]

Status

Inactive or Resolved


3:13-cv-05871 10/3/2013 10/4/2013

CFPB Takes Action Against Meracord for Processing Illegal Debt-Settlement Fees
http://www.consumerfinance.gov/policy-compliance/enforcement/actions/meracord-llc-linda-remsberg/

  • Consumer Financial Protection Bureau (CFPB)
  • Federal district court case
  • U.S. District Court Western District of Washington at Tacoma
  • Nonbank
  • $1,300,000
  • Not Available

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