The American Bar Association Wednesday issued a formal opinion finding that a growing practice by district attorneys of allowing debt collection agencies to issue demand letters that suggest they originated from the prosecutor’s office violates ABA Model Rules of Professional Conduct.

“Typically, no lawyer in the prosecutor’s office reviews the case file to determine whether a crime has been committed and prosecution is warranted or reviews the letter to ensure it complies with the Rules of Professional Conduct prior to the mailing,” Formal Opinion 469 states.

The ABA’s Standing Committee on Ethics and Professional Responsibility concluded that prosecutors involved in this practice violate ABA Model Rule 8.4(c) that deals with “dishonesty, fraud, deceit or misrepresentation” and Model Rule 5.5(a) that addresses unauthorized practice of law.

The relationships between many district attorneys and debt collection firms, primarily engaged in bad check recovery, began to receive scrutiny after a major article ran in The New York Times in 2012. As the ABA noted in its release, subsequent news reports have revealed that more than 300 local DAs’ offices have contracted with debt collection agencies.

Prosecutors involved in the partnerships frequently offer their seal and signature to use on dunning letters. The letters often threaten prosecution and steer the consumer to a fee-based personal finance class. The prosecutor’s office typically gets a cut of the money generated from the finance class. And all of this is done without prosecutorial oversight or determination of wrongdoing.

“A prosecutor who provides official letterhead of the prosecutor’s office to a debt collection company for use by that company to create a letter purporting to come from the prosecutor’s office that implicitly or explicitly threatens prosecution, when no lawyer from the prosecutor’s office reviews the case file to determine whether a crime has been committed and prosecution is warranted or reviews the letter to ensure that it complies with the Rules of Professional Conduct, violates Model Rules 8.4(c) and 5.5(a).” the opinion said.

Some states have moved to limit the offending behavior by passing laws banning debt collectors from using letterhead or seals of government agencies in their collection efforts, most notably Oregon last year. DA offices are also voluntarily pulling back from the arrangements under public pressure.


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