Cuomo’s office sued Williamsville-based attorney John P. Nicolia

BUFFALO, NY (May 6, 2010) - Attorney General Andrew M. Cuomo today announced his office has sued a Western New York lawyer who sold debt collectors the use of his name, which the debt collectors then used to intimidate consumers by threatening bogus legal action. The action is the latest in Attorney General Cuomo’s ongoing probe into unlawful debt collection practices.

Cuomo’s office sued Williamsville-based attorney John P. Nicolia after an investigation determined that he collected $141,000 in fees in return for allowing debt collectors to threaten consumers across the country by using his name and his law firm’s name. In reality, Nicolia never provided any actual legal services for the debt collection company, Eastern Asset Management.

“The lawsuit alleges that this attorney knowingly allowed a debt collection firm to use his name to threaten, intimidate, and harass consumers, while he sat back and profited without having to do any actual work,” said Attorney General Cuomo. “Our investigation into illegal debt collection practices has uncovered layer upon layer of abusive acts, and we will continue to root out the bad players in this industry.”

An investigation by Attorney General Cuomo’s Office determined that Nicolia, despite being paid $69,000 in 2008 and $72,000 in 2009, has no records to show that he provided any legal services to the debt collection companies. However, the collectors employed his name repeatedly - with Nicolia’s knowledge - in attempts to collect debts:

* Collectors who called the consumers to collect on the debts claimed that they were calling from, or working with, “the Law Office of John Nicolia.”
* Collectors sent standardized “settlement” letters citing non-existent judgments to consumers believed to owe debts, claiming “…our legal counsel, John Nicolia, Esq. may review the status of your particular case at anytime.”

The debt collection company, after invoking Nicolia’s name, often falsely stated that the consumers:

* Had lawsuits filed against them
* Would have their driver’s licenses suspended
* Would be charged with a crime
* Would be imprisoned or lose their property if they didn’t pay

Attorney General Cuomo’s lawsuit seeks a court order barring Nicolia from allowing debt collection companies to use his name, as well as imposing significant civil penalties against Nicolia for the violations.

The federal Fair Debt Collection Practices Act and the New York State debt collection and consumer protection laws prohibit the following conduct: posing as an attorney, threatening lawsuits or other legal action which cannot be taken, saying a consumer committed a crime or will be arrested, and talking with third parties except to get location information. The law further requires collection agencies to send a written notice within five days of initial communication with the consumer explaining how he or she can dispute the debt. If properly disputed, the collection agency must stop all collection attempts and send verification.

Since commencing the statewide initiative in May 2009, Cuomo has shut down 14 debt collection and affiliated process serving companies and required others to reform their deceptive practices. His office has also garnered criminal convictions against 10 collectors who engaged in especially egregious and threatening actions against consumers. The investigation is ongoing and lawsuits against several other collection companies are pending.

Cuomo urges consumers to visit to learn their rights. The site allows victims of debt collection and debt settlement companies quick access to the Attorney General’s office to file complaints, and outlines the stages of the Attorney General’s investigation.

The matters are being handled by Assistant Attorney General James Morrissey under the supervision of Deputy Attorney General for Regional Affairs J. David Sampson and Special Deputy Chief of Staff Mitra Hormozi.