Logic Escapes Me in Howard Law Court Argument

OMG, the Morgan Drexen lawsuit is still ongoing. I refuse to go back over all the history on this attorney model debt settlement suit. If you want to learn more, click here.

The Morgan Drexen suit morphed into additional action against Vincent Howard, Howard Law, Lawrence Williamson, Williamson & Howard, and the Williamson Law Firm.

The CFPB argued and the court bought the premise that the ongoing business needed to have their assets seized to prevent the further loss of money so consumers could get a refund from illegal debt settlement monies paid.

The attorneys for Vincent Howard, Lawrence Williamson, Howard Law, P.C., Williamson & Howard LLP; and Williamson Law Firm, have filed a court document dealing with releasing funds to Howard Law and Vincent Howard.

The position seems to be that the court needs to get off the back of the firm and let it get back to business to generate money. That would be the money owed to “vulnerable consumers” who were paying alleged illegal advance fees to the firm to begin with, right?

The court document says, “In order for there to be a source of income, the law firm must be healthy which includes financed operations so that the law firm can be a going concern.”

The document goes on to say. “The CFPB cannot understand “why HLPC should continue to pay Howard a six-figure salary when it owes consumer millions of dollars.” Perhaps it can be understood if the figure is arrived at by beginning with his expenses. Howard seeks authorization to access assets for payment of personal expenses that match the monthly expenses this Court has approved for Williamson.

Howard’s sole asset base is and has been salary. After the payment of federal tax withholdings which includes payments to the IRS for previous years, the salary would permit the modest “take-home” requested for the personal expense budget.”

There is a request for long-term disability insurance and vision coverage. I wonder how many of the impacted consumers from Morgan Drexen can afford to pay for those perks. Seriously, can’t Howard pay for his own eye exam and glasses or when does it just ridiculous?

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Here is My Favorite Part

The court document makes the argument that more money for marketing is necessary and should be part of the budgeted money released to Howard Law. But marketing for what? Do they really need more marketing dollars for the debt settlement effort that was already labeled as being illegal?

The document says, “The marketing dollars are being spent for only one reason – to generate business for the law firm. This can only benefit the consumers.” Let’s see, that would be to benefit the consumers who already paid money and are trying to recover it? How in the world are consumers benefited? And what business model would the firm take up to benefit future consumers. And let’s not forget the firm already said they were closing out their debt settlement business. So what are they advertising for?

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But then there is this kicker for anyone concerned about the sensitive private information they may be giving over to the call center marketing new services. Apparently the call center is now run offshore. “The reason why businesses outsource to offshore business is precisely because the cost of labor is cheaper. The notion that it would more reasonable to hire temporary domestic employers at a lower wage, as suggested by the CFPB, is farcical and reflects that the CFPB has not utilized the services of temporary employees. This particular Call Center provides a lower hourly rate than allowed under California state law. There is no HLPC subsidized medical Insurance.”

But if you are one of the “vulnerable consumers” that the court has stated is owed a return of money you paid, maybe you can just suck it up and take comfort that some of your money will be diverted to the future education of Howard’s step-children. “Is it necessary for Mr. Howard to assist in paying for his future stepchildren’s education? Perhaps the answer to that question is based upon how one views his relationship with step-children. Mr. Howard’s commitment to and support of these children is admirable and should not be deemed dissipation of assets.”

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It’s too bad this wasn’t the view taken all along about the clients sucked into this mess.

Just image that statement if you switch it around. “Is it necessary for Mr. Howard to assist in paying refunds owed his clients? Perhaps the answer to that question is based upon how one views his relationship with clients. Mr. Howard’s commitment to and support of these consumers is admirable and should not be deemed dissipation of assets.”

If that was the case I would be the CFPB and court would not disagree.

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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