Is Frank Santiago, the owner and operator of Northern Asset Management, LLC and Eastern Asset Management, LLC, Being Sued By The Attorney General ?

BUFFALO, N.Y. (June 1, 2010) - Attorney General Andrew M. Cuomo today announced a lawsuit against several Western New York debt collection companies that violated the law by harassing consumers through repeated threatening and obscene phone calls as well as making illegal calls to the consumers’ employers and families.

Attorney General Cuomo’s lawsuit claims Frank Santiago, of South Creek Road in Hamburg, who is the owner and operator of Northern Asset Management, LLC and Eastern Asset Management, LLC, had employees use abusive measures and lies in the debt collection operation. The suit seeks to shut down the companies, bar Santiago from the collection business and require him to pay significant penalties, costs and fees to the state.

“There are clear laws that say how a debt collection company can do business, and we allege that this debt collector and his companies broke those laws.” said Attorney General Cuomo. “Threats, intimidation, obscene language and overt harassment are just some of the day-to-day business practices that were employed by this operation. Their actions must come to an end.”

The Attorney General’s investigation determined that Santiago tried to avoid detection from authorities by changing the name of his companies after consumer complaints mounted. Santiago operated a company called Ethical Asset Management from late 2006 through mid 2007. After complaints, Santiago closed Ethical Asset and opened Eastern Asset. After being sued dozens of times, Santiago shut down Eastern Asset in December 2009 and immediately began operating Northern Asset, which is still active.

Earlier this month, in a related case, Cuomo sued Williamsville-based attorney John P. Nicolia after an investigation determined that he collected $141,000 in fees for allowing Santiago’s companies to threaten consumers across the country using Nicolia’s name. In reality, Nicolia never provided any actual legal services for the debt collection companies.

Santiago’s collectors, 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 and/or would be imprisoned or lose their property if they didn’t pay.

The collectors also repeatedly harassed consumers and their relatives often at unconscionable times. One consumer claimed that he received calls as early as 6:50 in the morning from various phone numbers. Others claimed the company called 10-15 times a day to their home, cell phone, work and even to family members over an extended period of time. One consumer complained that the collectors called “constantly every 2 minutes, then when he couldn’t talk to me he called my 85-year-old neighbor and told her that this is a matter I can’t ignore and if I don’t contact them that they will be sending the police to my house.”

Additionally, Santiago’s company regularly and illegally contacted consumers’ employers over the alleged debts. In one case, a collector continued to call and harass a consumer at work, leading to the consumer to lose a day’s pay because they were not allowed to take personal calls at work. Another collector called the employer of a consumer - on medical leave due to a high-risk pregnancy - and threatened to subpoena the employer at the workplace.

Santiago’s collectors also regularly misrepresented the specifics of the alleged debts, including overstating the amount owed. Despite requests, the companies also failed to produce written proof of the debts to consumers.

The Attorney General’s Office also found that Santiago’s debt collectors repeatedly used obscene, abusive, threatening and racist language when contacting consumers over alleged debts.

Attorney General Cuomo’s lawsuit seeks to bar Santiago and his affiliated businesses from the debt collection industry in New York State and require him to pay significant penalties, costs and fees for the multiple violations of law.

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 suit is being handled by Assistant Attorney General James Morrissey under the supervision of Assistant Attorney General-in-Charge of the Regional Office Russell T. Ippolito, Deputy Attorney General for Regional Affairs J. David Sampson and Special Deputy Chief of Staff Mitra Hormozi.