California Debt Collectors To Pay $25,000 Civil Penalty To Settle Abusive Practices Charges

For Release

The principal officials of a San Francisco Bay area collection agency, T.C.A., Inc., have paid $25,000 in civil penalties to settle charges that they violated the Fair Debt Collection Practices Act (FDCPA) when they or their collectors used abusive and deceptive practices in attempting to collect debts from consumers. The civil penalty settlement follows a court order permanently enjoining Stephen Lawrence and Effie Pappas, as well as T.C.A., from engaging in further violations of the FDCPA.

Today’s settlement stems from Federal Trade Commission charges filed by the Justice Department in federal district court in San Francisco in May 1995. According to the complaint, the defendants’ business practices included using obscene language, letting consumers’ phones ring repeatedly or calling at all hours, misrepresenting that failing to pay debts would result in arrest or imprisonment, falsely representing that they were attorneys or threatening to take legal action that they did not intend to take, calling consumers at work when they knew the consumers’ employers prohibited such calls, and continuing to contact consumers after the consumers exercised their legal right to request in writing that communications cease. These practices are all prohibited by the FDCPA.

Settlements with two other defendants connected to this case were filed in court at the same time as the T.C.A. complaint -- each included a cease and desist order against further FDCPA violations. Those settlements were with T.C.A.’s former senior vice president David Siebert and company attorney James R. Brown. The Brown settlement also required him to pay a $2,000 civil penalty.

In January 1997, the district court issued a partial summary judgment holding T.C.A., Lawrence and Pappas liable for the alleged FDCPA violations and permanently barring them from further violations. At that time, the court left open the issue of the personal liability of Lawrence and Pappas for civil penalties. The amount of civil penalties for T.C.A. is still at issue.

The settlement with Lawrence and Pappas actually imposes a $100,000 civil penalty judgment, but the language of the settle-ment allowed $75,000 to be suspended so long as they paid the remaining $25,000 by April 30, which they did. The settlement was filed in U.S. District Court for the Northern District of California, by the Department of Justice at the FTC’s request, and entered on April 17. The Federal Trade Commission vote to authorize filing was 5-0. This case was handled by the FTC’s San Francisco Regional Office.

NOTE: This consent judgment was for settlement purposes only and does not constitute an admission by the defendant of a law violation. Consent judgments have the force of law when signed by the judge.

Copies of documents associated with this case are available from the FTC’s Public Reference Branch,Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. FTC news releases, consumer brochures and other materials also are available on its web site at To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

(FTC File No. X950082)
(Civil Action No. C-95-1627-JLQ)

Contact Information

Media Contact:
Brenda Mack
Office of Public Affairs
Staff Contact:
Sylvia Kundig or Erika Wodinsky
San Francisco Regional Office
901 Market Street, Suite 570
San Francisco, California 94103