Case Study: CFPB Orders Midland Credit $79 Million for FDCPA Violations

In one of the largest debt collection enforcement actions ever, the Consumer Financial Protection Bureau ordered Encore Capital Group and its subsidiaries - including Midland Credit Management - to pay $79 million for illegal debt collection practices.

Who Is Midland Credit Management?

Midland Credit Management is part of Encore Capital Group, the largest debt buyer and collector in the United States. They purchase old debts from original creditors for pennies on the dollar, then attempt to collect the full amount.

As of 2025, Midland files approximately 500 lawsuits per week in Pennsylvania alone.

What They Did Wrong

The CFPB found Encore and its subsidiaries violated multiple consumer protection laws:

Collecting Debts They Couldn't Prove

• Collected on debts without proper documentation
• Filed lawsuits based on incomplete or inaccurate information
• Used "robo-signed" affidavits - legal documents signed without actual review

Deceptive Practices

• Threatened legal action they didn't intend to take
• Misrepresented amounts owed
• Failed to properly disclose that debts were time-barred

Illegal Collection Tactics

• Continued collection after receiving cease communications
• Called consumers at inconvenient times
• Contacted third parties improperly

The Penalties

The 2020 settlement required:

• $79,308.81 in consumer redress (to be paid to harmed consumers)
• $15 million civil penalty
• 5 more years of enhanced compliance requirements
• Improved disclosures to consumers about their rights
• Restrictions on collecting time-barred debt

Why This Matters for You

This case proves that even the largest debt collectors can be held accountable. Key takeaways:

1. Demand Validation

Midland was caught collecting debts they couldn't properly document. Always send a debt validation letter within 30 days of first contact.

2. Know Time-Barred Debts

Midland was penalized for not telling consumers when debts were past the statute of limitations. Check your state's SOL before paying anything on old debt.

3. Document Violations

The CFPB case was built on patterns of abuse across thousands of consumers. Your individual documentation could be part of future enforcement - or your own lawsuit.

4. Individual Lawsuits Work

Beyond the CFPB action, Midland settles individual FDCPA cases regularly. Attorneys familiar with their practices know exactly what violations to look for.

Being Contacted by Midland?

If Midland Credit Management or Midland Funding is contacting you:

1. Send a debt validation letter within 30 days
2. Check the statute of limitations in your state
3. Document every contact - dates, times, what was said
4. Know the red flags - threats of arrest, garnishment threats without judgment, calls at wrong hours

If they've violated your rights, an FDCPA attorney can help - and it costs you nothing because of fee-shifting.