Collector – May 2019 - 48

GOVERNMENTAFFAIRS

Shedding Light on Regulation by Enforcement
ACA member Scott Weltman details his experience fighting the CFPB in an extraordinary lawsuit.
By Katy Zillmer

S

cott Weltman, an ACA
International member who serves
as managing shareholder of
Weltman, Weinberg & Reis Co., LPA, told
the House Financial Services Committee
on March 7 that a Consumer Financial
Protection Bureau lawsuit his company
faced in 2017 was the bureau's attempt at
"regulation through enforcement."
Weltman was invited by Committee
Ranking Member Patrick McHenry,
R-N.C., to testify during the hearing titled,
"Putting Consumers First? A Semiannual
Review of the Consumer Financial
Protection Bureau."
Weltman was among a short list of
other high-level professionals who testified
following CFPB Director Kathy Kraninger's
first appearance before the committee.
Kraninger spent four hours in front of the
committee answering a range of questions

covering everything from her background in
the financial services sector to her opinion
on whether the CFPB should exist.
Meanwhile, Weltman was asked by the
committee to recount his experience dealing
with the CFPB in a lawsuit that ultimately
resulted in judgment entered in favor of
defendant Weltman, Weinberg & Reis Co.,
LPA, by the judge in the U.S. District Court
for the Northern District of Ohio.
The CFPB alleged that Weltman,
Weinberg & Reis Co., LPA's attorneys were
not meaningfully involved in reviewing
consumer accounts, but sent demand letters
and made collection calls falsely representing
that attorneys were involved in collecting the
debts. Ohio Judge Donald C. Nugent found
the bureau's lawsuit lacked merit.
According to Weltman's prepared testimony:
"Our story with the CFPB ... began before
the bureau was formed. In 2009, our law firm

Rae Ann Bevington (right) sits with Melanie Weltman and Scott Weltman at a House Financial
Services Committee hearing. Scott's father, Robert Weltman, is sitting on the other side of his son.

48

was hired by Ohio Attorney General Richard
Cordray as special counsel, which meant
that our law firm was directly responsible
for collecting the state of Ohio's debts. Mr.
Cordray not only significantly vetted our
firm and condoned exactly how we did
business, he also required that our letters
be written precisely to his specifications.
And after observing firsthand how we did
business, he hired us a second time.
"Once he became director of the CFPB,
however, Mr. Cordray [Richard Cordray
served as CFPB director from 2012-2017]
then approved a lawsuit against us claiming
that virtually identical letters violated the
law. And he authorized a press release
accusing us of this illegal behavior, which
was subsequently reprinted by every major
national, local and industry news agency."
The lawsuit and extensive Civil
Investigative Demand (CID) process

CFPB Director Kathy Kraninger minutes prior to her first appearance as director testifying
before the House Financial Services Committee.

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Collector – May 2019

Table of Contents for the Digital Edition of Collector – May 2019

Upfront
Industry News
Best Practices
FYI
Collection Tips
The Robot Revolution
ACA International’s 2019 Convention & Expo
Number Crunching
Calendar
Honor Roll
Education Spotlight
Regulators Should Be In The Business Of Helping The Regulated Comply
ACA SearchPoint
Ad Index
Membership
Last Word
Collector – May 2019 - Cover1
Collector – May 2019 - Cover2
Collector – May 2019 - 1
Collector – May 2019 - 2
Collector – May 2019 - 3
Collector – May 2019 - Upfront
Collector – May 2019 - 5
Collector – May 2019 - Industry News
Collector – May 2019 - 7
Collector – May 2019 - 8
Collector – May 2019 - 9
Collector – May 2019 - 10
Collector – May 2019 - 11
Collector – May 2019 - Best Practices
Collector – May 2019 - 13
Collector – May 2019 - FYI
Collector – May 2019 - 15
Collector – May 2019 - Collection Tips
Collector – May 2019 - 17
Collector – May 2019 - The Robot Revolution
Collector – May 2019 - 19
Collector – May 2019 - 20
Collector – May 2019 - 21
Collector – May 2019 - ACA International’s 2019 Convention & Expo
Collector – May 2019 - 23
Collector – May 2019 - 24
Collector – May 2019 - 25
Collector – May 2019 - 26
Collector – May 2019 - 27
Collector – May 2019 - 28
Collector – May 2019 - 29
Collector – May 2019 - 30
Collector – May 2019 - 31
Collector – May 2019 - 32
Collector – May 2019 - Number Crunching
Collector – May 2019 - 34
Collector – May 2019 - 35
Collector – May 2019 - Calendar
Collector – May 2019 - Honor Roll
Collector – May 2019 - Education Spotlight
Collector – May 2019 - 39
Collector – May 2019 - 40
Collector – May 2019 - 41
Collector – May 2019 - 42
Collector – May 2019 - 43
Collector – May 2019 - 44
Collector – May 2019 - 45
Collector – May 2019 - 46
Collector – May 2019 - 47
Collector – May 2019 - 48
Collector – May 2019 - Regulators Should Be In The Business Of Helping The Regulated Comply
Collector – May 2019 - 50
Collector – May 2019 - 51
Collector – May 2019 - ACA SearchPoint
Collector – May 2019 - Ad Index
Collector – May 2019 - Membership
Collector – May 2019 - 55
Collector – May 2019 - Last Word
Collector – May 2019 - Cover3
Collector – May 2019 - Cover4
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