Asset Acceptance Capital Corp. Announces FTC Consent Decree
January 30 2012 - 10:32AM
Business Wire
Asset Acceptance Capital Corp. (NASDAQ: AACC), a leading
purchaser and collector of charged-off consumer debt, announced
today that its subsidiary, Asset Acceptance, LLC, has resolved an
FTC investigation of the Company’s practices under the Federal
Trade Commission Act, Fair Debt Collection Practices Act and Fair
Credit Reporting Act. As part of the consent decree Asset
Acceptance, LLC has agreed to undertake industry-leading consumer
protection practices and to pay a civil penalty of $2.5 million.
The consent decree ends an FTC investigation begun in February
2006, without any admission by Asset Acceptance of the FTC’s
claims. The Company does not expect the operational requirements of
the consent decree to have a material adverse effect on its
business.
Rion Needs, President & CEO, stated “Asset Acceptance is an
industry leader in the amount of information we give consumers.
This agreement gives consumers even more visibility into how we
will work with them and sets new standards for the industry. We are
pleased to have this matter behind us, and to have clarity on the
FTC’s policies and expectations of the debt collection industry. As
we have already implemented many of the requirements of the consent
decree, we now welcome the opportunity to work with the FTC to make
these measures the new standards in debt collection.”
The Company had previously recorded accruals related to the $2.5
million settlement of $1,250,000 in the fourth quarter of 2010 and
$1,250,000 in the third quarter of 2011. For more information on
the consent decree, please visit www.AssetAcceptance.com for a list
of frequently asked questions.
About Asset Acceptance Capital Corp.
For 50 years, Asset Acceptance has provided credit originators,
such as credit card issuers, consumer finance companies, retail
merchants, utilities and others an efficient alternative in
recovering defaulted consumer debt. For more information, please
visit www.AssetAcceptance.com.
Asset Acceptance Capital Corp. Safe Harbor Statement
This press release contains certain statements, including the
Company's plans and expectations regarding its operating
strategies, charged-off receivables, collections and costs, which
are forward-looking statements and are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements include reference to the
Company’s presentations and webcasts. These forward-looking
statements reflect the Company's views, expectations and beliefs at
the time such statements were made with respect to such matters, as
well as the Company's future plans, objectives, events, portfolio
purchases and pricing, collections and financial results such as
revenues, expenses, income, earnings per share, capital
expenditures, operating margins, financial position, expected
results of operations and other financial items. Forward-looking
statements are not guarantees of future performance and involve
certain risks, uncertainties and assumptions (“Risk Factors”) that
make the timing, extent, likelihood and degree of occurrence of
these matters difficult to predict. Words such as “anticipates,”
“believes,” “estimates,” “expects,” “intends,” “should,” “could,”
“will,” variations of such words and similar expressions are
intended to identify forward-looking statements.
There are a number of factors, many of which are beyond the
Company's control, which could cause actual results and outcomes to
differ materially from those described in the forward-looking
statements. These Risk Factors include the Risk Factors discussed
under “Item 1A Risk Factors” in the Company’s most recently filed
Annual Report on Form 10-K and in other SEC filings, in each case
under a section titled “Risk Factors” or similar headings and those
discussions regarding risk factors as well as the discussion of
forward-looking statements in such sections are incorporated herein
by reference. Other Risk Factors exist, and new Risk Factors emerge
from time to time that may cause actual results to differ
materially from those contained in any forward-looking statements.
Factors that could affect our results and cause them to materially
differ from those contained in the forward-looking statements
include the following:
- our ability to maintain existing, and
to secure additional financing on acceptable terms;
- failure to comply with government
regulation;
- our ability to purchase charged-off
receivable portfolios on acceptable terms and in sufficient
amounts;
- a decrease in collections if changes in
or enforcement of debt collection laws impair our ability to
collect, including any unknown ramifications from the Dodd-Frank
Wall Street Reform and Consumer Protection Act;
- the costs, uncertainties and other
effects of legal and administrative proceedings impacting our
ability to collect on judgments in our favor;
- ongoing risks of litigation in our
litigious industry, including individual and class actions under
consumer credit, collections and other laws;
- a decrease in collections as a result
of negative attention or news regarding the debt collection
industry and debtors’ willingness to pay the debt we acquire;
- instability in the financial markets
and continued economic weakness limiting our ability to access
capital and to acquire and collect on charged-off receivable
portfolios;
- concentration of a significant portion
of our portfolio purchases during any period with a small number of
sellers;
- our ability to respond to changes in
technology to remain competitive;
- our ability to substantiate our
application of tax rules against examinations and challenges made
by tax authorities;
- our ability to make reasonable
estimates of the timing and amount of future cash receipts and
assumptions underlying the calculation of the net impairment
charges or IRR increases for purposes of recording purchased
receivable revenues;
- our ability to collect sufficient
amounts from our purchases of charged-off receivable
portfolios;
- our ability to diversify beyond
collecting on our purchased receivables portfolios into ancillary
lines of business;
- our ability to successfully hire,
train, integrate into our collections operations and retain
in-house account representatives;
- our ability to acquire and to collect
on charged-off receivable portfolios in industries in which we have
little or no experience;
- any significant and unanticipated
changes in circumstances leading to goodwill impairment could
adversely impact earnings and reduce our net worth; and
- other unanticipated events and
conditions that may hinder our ability to compete.
Given these risks and uncertainties, investors should not place
undue reliance on forward-looking statements as a prediction of
actual results. Furthermore, the Company expressly disclaims any
obligation to update, amend or clarify forward-looking
statements.
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