Cobb law firm accused of charging former debtors for court error - WALB.com, Albany News, Weather, Sports

Cobb law firm accused of charging former debtors for court error

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COBB COUNTY, GA (CBS46) -

A federal class action lawsuit filed Tuesday accuses a controversial law firm in Cobb County of breaking debt collection laws by dipping into a man's paycheck to cover a debt he didn't owe. 

"It's horrible. It's despicable," said Eduardo Austin, of Sandy Springs. "Fred Hanna saw this as an opportunity to get money."

Austin sued Frederick J. Hanna and Associates for its attempt to garnish $970 from his wages to cover interest that accrued when Fulton County State Court failed to send Austin's previous garnishment to Hanna.

Austin said Hanna's firm knew he had paid $3,300 into the court registry in 2010 to cover an unpaid Discover Card account.  

CBS46 News learned Fulton County's once backlogged garnishment division failed to send Austin's funds to Hanna until 2013. Court records reviewed by investigative reporter Jeff Chirico found the garnishments of 1,900 other individuals were also held. 

Austin fought the garnishment and a Gwinnett County judge ruled against Hanna's firm in June 2013.

"I think this goes beyond the normal piggyness I see with debt collectors," said attorney Steve Koval, who represents Austin. "It's really hard to understand how [Frederick J. Hanna and Associates] could think something like this was justified."

Hanna, through the firm's managing partner Joseph Cooling, declined multiple requests for an interview.  

When Chirico found Hanna leaving a Cobb County Bar Association luncheon, Hanna wouldn't explain why his firm garnished Austin's wages for a mistake made by Fulton County.

In a statement, Cooling wrote, "We have every confidence that we have complied with Georgia and federal law at all times. We believe the lawsuit filed by Mr. Austin is frivolous, contrary to well-established Georgia law, and we will seek to have it dismissed."

Cicely Barber, chief clerk of Fulton County State and Magistrate Court, said due to an old case management system the garnishment division inadvertently kept approximately $2 million in garnishments that were owed to Hanna's firm. It wired the funds in February 2013. 

In a statement, Barber pointed out that the court now has a new case management system. 

To know your rights when dealing with debt collectors, the Governor's Office of Consumer Protection has compiled a helpful list of consumer tips.

You can also find more information here: http://www.nolo.com/legal-encyclopedia/georgia-fair-debt-collection-laws.html.

If you believe a debt collector has violated the law, you can file a complaint with the Governor's Office of Consumer Protection.

If you have a problem with a law firm that's trying to collect a debt, you can file a complaint with the State Bar of Georgia or the Federal Trade Commission. The Supreme Court ruled the Office of Consumer Protection does not have jurisdiction over law firms that collect debt.

Georgia Legal Aid also have more information about debt collection garnishments. 

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