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Consumer Financial Protection Bureau Files Suit Against Fair Collections & Outsourcing and Michael E. Sobota

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (Bureau) today filed a lawsuit in the federal district court in the District of Maryland against FCO Holding, Inc. and its subsidiaries, Fair Collections & Outsourcing, Inc., Fair Collections & Outsourcing of New England, Inc., and FCO Worldwide, Inc. The entities are Maryland-based debt collectors that operate collectively under the name Fair Collections & Outsourcing and FCO. Also named in the Bureau’s lawsuit is Michael E. Sobota, the chief executive officer, president, director, and owner of FCO Holding, Inc.

The Bureau’s complaint alleges that FCO violated the Fair Credit Reporting Act, Regulation V and the Consumer Financial Protection Act by:

  • failing to establish or implement reasonable written policies and procedures regarding the accuracy and integrity of the information it furnished to consumer reporting companies, specifically with respect to its handling of indirect disputes; 
  • failing to consider or incorporate the appropriate guidelines in developing its policies and procedures regarding the handling of indirect disputes;
  • failing to review its indirect dispute handling policies and procedures and update them as necessary to ensure their continued effectiveness; 
  • failing to conduct a reasonable investigation, or any investigation, and review all relevant information in its handling of indirect disputes; and
  • furnishing information about accounts before or without conducting an investigation into the accuracy of the information it was furnishing after receiving identity theft reports from consumers disputing such accounts. 

Finally, the Bureau’s complaint alleges that FCO and Michael E. Sobota violated the Fair Debt Collection Practices Act when FCO represented that consumers owed certain debts when, in fact, FCO did not have a reasonable basis to assert that the consumers owed those debts. 

The Bureau’s complaint seeks an injunction, as well as damages, redress, disgorgement of ill-gotten gains, and the imposition of a civil money penalty.

A copy of the complaint filed in federal district court in the District of Maryland is available here:

The Consumer Financial Protection Bureau is a 21st century agency that implements and enforces Federal consumer financial law and ensures that markets for consumer financial products are fair, transparent, and competitive. For more information, visit