Nevada Association Services Inc., a bill collector for Las Vegas-area homeowner associations, was hit Wednesday with its fourth federal lawsuit since Dec. 17 over its collection practices.
Like the previous lawsuits, the new suit filed in federal court in Las Vegas claims Nevada Association Services (NAS) has tried to collect unauthorized fees.
The suit was filed by Las Vegas attorney David Ford on behalf of Henderson homeowners Cory and Tammy Compton, who are members of the Boulder Creek HOA.
The suit claims NAS violated the federal Fair Debt Collection Practices Act (FDCPA) by trying to collect "attorney’s fees and collection costs" even though the Comptons had paid past-due assessments and their HOA had waived all late fees and interest.
NAS is accused of violating the act by diverting current assessment payments toward previous attorney’s fees and costs – without the Comptons’ approval and causing the Comptons to fall deeper into debt.
Among other things, NAS is accused of trying to collect fees not authorized by the community’s agreement with homeowners and of falsely representing "the collection of the debt is from an attorney."
The lawsuit also alleged violations of a state law against deceptive trade practices when NAS "committed consumer fraud by threatening that if payment was not made within 30 days, foreclosure proceedings will immediately begin."
NAS President David Stone denied the allegations, saying, "We’re FDCPA compliant."
"It’s a feeding frenzy out there," he said, noting the frequency at which the company gets sued.
"We’re going to fight it. If they’re looking for a settlement, they’re not going to get it," he said of the new lawsuit.
The three previous federal suits filed against NAS – as well as certain HOAs and collection agencies – remain active. These are in addition to litigation pending in state court.
In one federal case from January, a Bank of America subsidiary sued NAS, numerous Southern Nevada HOAs and their trustees claiming that in foreclosure situations they’re wrongly demanding the bank pay fees and collection costs it’s not obligated to pay.
In another January case alleging violations of the FDCPA, Jacob Seeley said NAS demanded payment of $380 over a $96 delinquency – and threatened an additional $325 in charges and a lien against his home if the $380 wasn’t paid within 10 days.
And in a December suit seeking class-action status against Stone and NAS and alleging violations of the FDCPA, homeowners and investors in foreclosed homes complained the defendants have demanded payment of collection fees and costs that were never authorized by homeowner associations.
These plaintiffs say the alleged costs were never incurred by HOAs and never agreed to by homeowners in community covenants, conditions and restrictions (CC&Rs); “and thus did not constitute a ‘debt’ owed to the” HOAs.
Stone and his attorneys are fighting all of these suits and they say that with the glut of foreclosures in Southern Nevada, HOAs are finding it difficult to balance their budgets and provide needed services because of property owners that don’t pay their assessments.
On his company’s website, Stone says he supports recently enacted caps on collection fees and that his company has always acted within these caps.
Stone said on the website these include limiting delinquent assessment fees to $1,950, plus "costs," and a management company fee of up to $200.