Collection Law Firm Fined $100k, Ordered to Stop Collecting in CT Without License

The Connecticut Department of Banking has fined a collection law firm $100,000 — the maximum amount allowed by law — and ordered it to cease and desist from collecting in the state without a valid license.

A copy of the enforcement order against the Law Offices of David M. Katz can be accessed by clicking here.

The state conducted an investigation earlier this year and issued a temporary order to cease and desist, a notice of intent to issue order to cease and desist, a notice of intent to impose a civil penalty, and a notice of a right to a hearing. The firm had 14 days to respond to the notice in order to request a hearing, and that if a request was not made, an order would likely be forthcoming.

During its investigation, the state discovered back in 2019 that the firm was conducting unlicensed collection agency activity for about 10,000 Connecticut accounts with a total balance of $1.4 million. The firm allegedly collected about $81,000 of that amount. The state sent the firm a certified letter and asked for a response, which was never provided.

At the time the temporary order was issued, the firm was asked to supply the state with a list of all the creditors with whom the firm has entered into agreements for consumer collection services since 2018, including copies of all the agreements with those creditors, and an itemized list of each Connecticut debtor account that the firm had attempted collections on going back to 2018.

The firm did not respond to the request.

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