In a twist of irony, National Credit Adjusters, a Kansas based delinquent accounts receivable company has filed suit against Cred X Debt Recovery, James Sauer, Jeffrey Schultz, and Richard Schultz. National Credit Adjusters claimed the following in their suit.
“On or about May 24, 2012, NCA contracted with Defendant Cred X to have Defendant collect unpaid accounts on NCA’s behalf.
On or about May 24, 2012, NCA and Cred X executed a Collection Service Agreement (“CSA”), attached as Exhibit 1, wherein Cred X agreed to collect on unpaid portfolios on NCA’s behalf under the agreement that Cred X would retain a percentage of the amount collected with the remainder of the monies collected remitted back to NCA on a semi-monthly basis.
On or about May 8, 2013, NCA and Cred X executed a revised Collection Service Agreement (“Updated CSA”), attached as Exhibit 2, wherein Cred X agreed to collect on unpaid portfolios on NCA’s behalf under the agreement that Cred X would retain a percentage of the amount collected with the remainder of the money collected remitted back to NCA on a semi-monthly basis.
Beginning on or about June, 2014, Defendant’s remittances were returned short of what was due to NCA.
The amount Defendants withheld from remittances to NCA soon exceeded $375,000.
On or about September 11, 2014, Plaintiff’s counsel sent a demand letter, attached as Exhibit 3, to Defendants demanding immediate termination of the CSA and remittance of all monies owed to NCA.
The demand letter also demanded NCA be entitled to an audit of Cred X.
On or about October 11, 2014, NCA met with Defendants.
Defendant Sauer, on behalf of himself and Cred X, agreed to a repayment plan of the cumulative failed remittances.
On or about May 7, 2015, Defendants wholly failed to deliver remittances to NCA.
As of August 7, 2015, Cred X was short in remittances cumulatively in an amount in excess of $800,000.00.
Defendants have failed and refused to remit to NCA the sums collected on its behalf and held in trust by Defendants.
On information and belief, Defendants have converted funds collected as a fiduciary agent for NCA to their own purposes and benefit.
Through correspondence to NCA, Defendants have admitted to collecting funds on NCA accounts without remitting NCA’s money to NCA.” – Source
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