Debt collector filed more than 20,000 lawsuits in Maricopa County

PHOENIX — In retirement, Anne Munoz, a former school bus driver who now cares for her husband with Parkinson’s disease, was prepared for life’s challenges. 

She cares for her garden, a flock of chickens, even ducks.  Munoz also saves money each year to give back to her community. She donates to the food pantry each Thanksgiving and donates gifts to a family from the “Angel Tree” at her local school each Christmas. 

She’s seen a lot. She does a lot. 

She thought she was ready for anything. 

Until last September, when she was sued by a debt collector.

“This came out of the blue, and it really kind of knocked me back, because I had no idea what this was about,” Munoz said. 

The lawsuit demands more than $2,700 for a Dell Financial Services account that was allegedly opened back in 2011. 

“It’s not my debt,” Munoz said. “I don’t know if this has to do with fraud, credit fraud, or what.” 

Munoz’s case is one of tens of thousands of unique lawsuits filed by a single company across the state. She’s playing a part in a major drama: consumer vs. creditor, but where the creditor’s isn’t really the creditor — but their profits are charted by Wall Street, even as the human cost rises.

Munoz had fallen into the sights of  a company called Portfolio Recovery Associates, publicly traded on the NASDAQ as PRAA. Its business model is simple: Buy debts deemed “uncollectable” from companies for pennies on the dollar and then try to collect the full amount through phone calls and lawsuits. The business model is as controversial as it is simple: PRAA agreed to pay consumers back $5 million in North Carolina and was ordered to pay $24 million by a federal government watchdog.

It’s one of the nation’s largest debt collectors.  PRAA has filed 21,000 lawsuits totaling $47 million in demands in Maricopa County alone since 2022. 

It’s an international company with operations in North and South America, Australia, and Europe, according to its 2024 report. 

“We purchased total portfolios of $285 million in the fourth quarter and $1.2 billion in 2023, with the latter representing an increase of 36% and the third highest level in company history,” said Vikram Atal, president and chief executive officer, in a statement to shareholders last year. 

“The impact of our cash generating and operational initiatives in our U.S. business—particularly around activity within call centers, post-judgment legal processes, and offshoring—have been highly encouraging, and demonstrate that we are on track to transform PRA into a more robust, efficient, and profitable enterprise,.”

Munoz had never heard of them. 

She said she did recall buying a Dell laptop in 2011, but believes she paid it back on time. 

She no longer owns the computer, let alone any receipts. She’s made multiple attempts to reach Dell for more information, but was told Dell no longer has the records either. 

She continued her research, quickly finding she was not the only Anne Munoz that Portfolio Recovery Associates sued for this very same debt. 

“They sent that notice to an Anne K. Munoz in Memphis, Missouri,” Munoz said. “I’ve never lived in Missouri, ever.” 

The 12News I-Team found Portfolio Recovery Associates had filed a separate lawsuit in Missouri back in April, demanding payment for the same debt. 

After several months, the company abandoned that lawsuit and refiled with the same information against Anne Munoz of Vernon, Arizona.

The 12News I-Team asked Portfolio Recovery Associates how the company tracked the debt and why it filed these two lawsuits for the same debt. 

In response to the I-Team’s questions, Elizabeth A. Kersey, Senior Vice President, Communications and Public Policy for PRA said in an email, “as a practice, we do not comment on specific legal matters.” 

“However, please note that we adhere to strict local, state and federal regulatory and statutory requirements, while seeking to define the highest standards in the industry,” Kersey continued in the email. “We also strive to act with integrity and treat our customers with respect and empathy at all times.” 

The I-Team found the lawsuit against Munoz is just one among thousands Portfolio Recovery Associates filed against Arizonans last year. 

Arizona has dozens of justice courts around the state, including the Round Valley Justice Court, where Munoz was sued. A court clerk provided records showing Munoz’s case is one of 16 Portfolio Recovery Associates filed in that jurisdiction. 

But in Maricopa County, the 12News I-Team obtained court data showing Portfolio Recovery Associates filed more than 21,000 unique lawsuits since 2022. 

These lawsuits claimed debts totaling more than $47 million from individuals. 

Lawsuits filed in justice courts must be less than $10,000 each. The I-Team analysis found the claims average $2,200. 

“You don’t know who these people are, and they’re suing on debts that were owed years ago that you, for some reason or another, could not pay or did not pay,”  said Jason Pikler, senior attorney with the North Carolina Justice Center. “So, most people, unfortunately, do not respond to these lawsuits, and the debt buyer then can move forward with getting a default judgment. 

They turn what was just a credit card debt into a civil judgment that they can use to garnish your wages or it applies against your real property. It’s a horrible situation.” 

Pikler’s team represented thousands of people in North Carolina who also got sued by PRA. 

“We saw that Portfolio Recovery Associates, when they were obtaining default judgments, were not filing what we thought were the necessary documents to comply with state law,” Pikler said. “So we filed a lawsuit.”

In 2024, PRA settled the lawsuit, agreeing to pay back more than $5 million to consumers in North Carolina. 

The I-Team also asked PRA specific questions about its work to verify and prove debts in each of the lawsuits filed throughout Arizona. Kersey’s emailed statement did not address those questions. 

“As a practice, we do not comment on specific legal matters. However, please note that we adhere to strict local, state and federal regulatory and statutory requirements, while seeking to define the highest standards in the industry. We also strive to act with integrity and treat our customers with respect and empathy at all times.” Elizabeth Kersey, Senior Vice President, Communications and Public Policy, PRA Group.”

The I-Team’s analysis of cases in Maricopa County found judgments against thousands of people totaling $4.7 million since 2022. 

“We would urge Arizona to enact some kinds of rules and regulations protecting people who don’t respond to the complaint, in recognition that that is the vast majority of people sued on these kinds of debts,” Pikler said. 

In 2023, the Consumer Financial Protection Bureau found the “debt collection giant filed lawsuits even when it lacked documentation about the debt.” 

In a March 2023 press release, the CFPB announced that it ordered Portfolio Recovery Associates to pay more than $24 million in “continued illegal debt collection practices” – and this wasn’t the first time. 

According to the filing, PRA was already the subject of a 2015 order from the CFPB to “clean up its faulty operations.” 

“After getting caught red-handed in 2015, Portfolio Recovery Associates continued violating the law through intimidation, deception and illegal debt collection tactics and lawsuits,” CFPB Director Rohit Chopra said in the statement. 

Among the many allegations against the company, the bureau claimed that PRA “collected on at least tens of thousands of debts that consumers disputed even though PRA did not take the required steps to substantiate the accuracy and validity of those debts.” 

For Munoz, these findings feel all too familiar. 

“That’s what they did to me,” Munoz said. “And it’s not just me. There’s other people. Other people need to know how to fight them, and I’d love to be able to do that.” 

For now, Munoz is preparing for her own day in court. 

She said she had to buy a new laptop and printer to prepare her own arguments before a justice of the peace that the case against her should be dismissed. 

Her hearing is scheduled in mid-January. 

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If you get served a lawsuit from Portfolio Recovery Associates or any other debt collector, take it seriously. 

“If you are out there and you do get sued by a debt collector, a debt buyer, don’t ignore it. Try to respond. Try to file an answer,” North Carolina attorney Jason Pikler said. 

Be aware of deadlines to respond to a lawsuit if you dispute the claims against you. If you fail to respond or appear in court, the debt collector can move forward with asking for a default judgment. 

“Try to get help. If you cannot afford an attorney, there are legal services organizations in Arizona that provide free legal assistance,  try to avail yourself of those,” Pikler said. 

Community Legal Services offers free services to people who qualify. 

Apply by Phone 602-258-3434 9:00am -2:00pm. Currently no walk-ins accepted.

Online 24 hours a day at  AZLawHelp.org – Arizona Law Help 

If you do not qualify for free legal aid, consider the “Modest Means Project” which offers low-cost attorney consultations at $75 per hour. 

Contact by phone: 866-637-5341

For more legal resources check AZ Law Help 

To learn more about how to respond to a debt collector or whether your rights may be violated, the Consumer Financial Protection Bureau provides information and resources.  

“Also, you know, if the Arizona legislature could help out by enacting common sense restrictions that make it more difficult for debt buyers to sue on these debts and obtain judgments that would also be great,” Pikler said. 

You can also contact your legislators by finding your district and your lawmaker’s contact information here. 

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