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					DISTRICT COURT, CITY AND COUNTY OF
DENVER, COLORADO

1437 Bannock Street
Denver, CO 80202
STATE OF COLORADO ex rel. JOHN W. SUTHERS,
ATTORNEY GENERAL FOR THE STATE OF
COLORADO, and LAURA E. UDIS, ADMINISTRATOR,
COLORADO FAIR DEBT COLLECTION PRACTICES
ACT,

Plaintiffs,

v.

REGENT ASSET MANAGEMENT SOLUTIONS, INC.
and MICHAEL A. SCATA,

Defendants.                                                       COURT USE ONLY 
JOHN W. SUTHERS                                                Case No.:
Attorney General
JEANINE M. ANDERSON, Atty. Reg. No. 28206*
Assistant Attorney General                                     Courtroom:
1525 Sherman Street, 7th Floor
Denver, CO 80203
Phone Number: 303-866-2030
FAX Number: 303-866-5474

*Counsel of Record
                                         COMPLAINT

        Plaintiffs, the State of Colorado ex rel. John W. Suthers, Attorney General for the State of
Colorado, and Laura E. Udis, Administrator of the Colorado Fair Debt Collection Practices Act
(collectively, the “State”), by and through the undersigned assistant attorney general, for their
Complaint, allege as follows:

                                  NATURE OF THE ACTION

        1.     Defendant Regent Asset Management Solutions, Inc. is a collection agency based
in Colorado. Defendant Michael A. Scata is Regent’s President and Chief Executive Officer. In
violation of the Colorado Fair Debt Collection Practices Act (the “FDCPA”) and the Colorado
Consumer Protection Act (the “CCPA”), Defendants are collecting debts without being licensed
to do so. Moreover, their business practices violate various requirements of the FDCPA and the
CCPA. Accordingly, the State brings this action seeking to enjoin preliminarily and permanently
Defendants’ unlawful business practices and seeking consumer restitution, civil penalties,
attorneys’ fees and costs, and other equitable relief the Court deems appropriate.

                                           PARTIES

        2.      John W. Suthers (“Suthers”) is the duly elected Attorney General of the State of
Colorado. He is authorized under C.R.S. § 6-1-103 to enforce the CCPA by bringing civil
actions against those that engage in deceptive trade practices. In such actions, the State may seek
injunctive relief, consumer restitution, disgorgement, civil penalties, damages, and attorneys’
fees and costs. C.R.S. §§ 6-1-110, 6-1-112, and 6-1-113.

        3.       Laura E. Udis is the duly appointed Administrator of the Uniform Consumer
Credit Code. C.R.S. § 12-14-103(1). In particular, she is authorized under C.R.S. § 12-14-135
to bring a civil action to restrain any person from any violation of the FDCPA.

        4.      Defendant Regent Asset Management Solutions, Inc. (“Regent”) is a Colorado
corporation with its principal place of business in Denver, Colorado. Among other things, its
principal purpose is the collection of debts, and it regularly collects or attempts to collect,
directly or indirectly, debts owed or due or asserted to be owed or due.

        5.     Defendant Michael A. Scata (“Scata”) is a Colorado resident who resides in
Boulder County, Colorado. Scata is, and at all relevant times was, the President and Chief
Executive Officer of Regent. As such, Scata, acting alone or in concert with others, has
formulated, directed, controlled, had the authority to control, or participated in the acts and
practices of Regent, including the acts and practices alleged in this Complaint.

       6.     Defendants’ practices, acts, or course of conduct described herein at all relevant
times were continuing.

                                JURISDICTION AND VENUE

       7.      This Court has jurisdiction over this case pursuant to C.R.S. § 13-1-124.

       8.      Pursuant to C.R.S. § 12-14-135, venue in actions brought by the Administrator to
enjoin violations of the FDCPA is proper in Denver County. In addition, pursuant to C.R.S. § 6-
1-103 and C.R.C.P. 98, venue is proper in Denver County because one or more of the
Defendants resides in Denver County.

                                         PUBLIC INTEREST

      9.     Through the misleading and deceptive practices of their business, Defendants
have misled and deceived consumers throughout the country, including Colorado residents.
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Defendants’ deceptive trade practices constitute prima facie evidence of Defendants’ intent to
injure competitors and to destroy or substantially lessen competition. C.R.S. § 6-1-105(2).

        10.     The General Assembly may prohibit the practice of a business in the absence of a
statutorily prescribed license, and there exists a strong public interest in the enforcement of such
statutes. See Bd. of Chiropractic Exam’rs v. Stjernholm, 935 P.2d 959, 969 (Colo. 1997).

       11.     Therefore, these legal proceedings are in the public interest.

                                 GENERAL ALLEGATIONS

        12.    Regent was licensed to conduct business as a collection agency in Colorado from
June 4, 2008 through July 1, 2010.

        13.     During the first half of 2010, the Administrator became concerned that Regent’s
collection activities may be violating the FDCPA.

       14.    The Administrator saw an increase in the number of consumer complaints she
received about Regent. Particularly troubling was a pattern that appeared to be emerging from
the complaints that led the Administrator to believe that Regent may not be complying with
C.R.S. § 12-14-109, dealing with the validation of debts.

       15.     In particular, the Administrator received several complaints in which consumers
alleged that they had not received the written disclosure from Regent mandated by C.R.S. § 12-
14-109(1) (the “Initial Notification”). Rather, according to the consumers, the first written
communication they received from Regent was a letter from an attorney that did not provide the
disclosures required by C.R.S. § 12-14-109(1).

        16.     In addition to this type of complaint, the Administrator received consumer
complaints alleging that when the consumer had disputed a debt, Regent did not provide the
verification of the debt required by C.R.S. § 12-14-109(2).

       17.    During this same time frame, on June 24, 2010 Regent’s former General
Manager, Nick Tafoya (“Tafoya”), contacted the Colorado Attorney General’s Office. Dara
Benoit, a compliance investigator with the Collection Agency Board, interviewed Tafoya.
Tafoya indicated he believed that certain of Regent’s collection practices did not comply with the
FDCPA. Among other things, Tafoya stated that while working at Regent he observed that
Regent did not as a regular practice send the Initial Notification to consumers. Indeed, according
to Tafoya, sometimes Regent would “stamp” the file with a date when the Initial Notification
went out, when the Initial Notification had not gone out that day (or at all).

        18.     In addition, Tafoya stated that when consumers disputed debts and requested
verification thereof by Regent, Regent would not comply with the request properly. Sometimes
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it would not provide any verification at all, and other times it would simply send a form letter
with very limited information from which the consumer could determine if the debt was
accurate.

       19.     Because of the complaints and Mr. Tafoya’s statement, the Administrator initiated
an investigation into Regent’s collection practices.

        20.   On June 29, 2010, at the direction of the Administrator, Investigator Benoit
visited Regent’s place of business at 7290 Samuel Drive, Suite 300, Denver, Colorado 80221.
Investigator Benoit requested that Regent produce certain business records to be used in
connection with the Administrator’s investigation.

        21.    On July 8, 2010, the day before the documents were to be produced, Regent
delivered a letter to the Administrator. In that letter, Regent withdrew its license renewal
request, then pending, and indicated that as of July 7, 2010 it had ceased all operations in
Colorado.

        22.    Thereafter, Defendants refused to comply voluntarily with the Administrator’s
investigation.

         23.     The next day, on July 9, 2010, the Administrator sent Regent a letter indicating
that its collection agency license had expired.

       24.     Despite the fact that Regent is no longer licensed as a collection agency, Regent
continues to be engaged in consumer debt collection.

       25.    Indeed, as late as September 3, 2010, Regent withdrew money from a consumer’s
bank account in connection with its unlawful debt collection activity.

        26.     In addition, the Administrator recently has learned that Regent has been operating
under the fictitious name of “Office of Ron Kennedy.” When leaving messages for consumers,
Regent requests that consumers call the “Office of Ron Kennedy” and leaves a phone number.
When Investigator Benoit called the number, Regent answered. The person who answered the
phone would not identify herself to Investigator Benoit, but told Investigator Benoit that Ron
Kennedy was not a real person or entity. Rather, Regent used it because it was more effective in
getting consumers to call Regent back.

        27.  Defendant Scata assists or aids, either directly or indirectly, in Regent’s violations
of the FDCPA and the CCPA and is thus responsible for those violations.




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                            FIRST CLAIM FOR RELIEF
             VIOLATIONS OF FDCPA (C.R.S. §§ 12-14-115(1)(a) AND 12-14-118)

       28.    The Administrator incorporates by reference the allegations of paragraphs 1
through 27 above as if fully set forth herein.

        29.     The FDCPA defines “collection agency” to include one whose principal purpose
is the collection of debts or who “[r]egularly collects or attempts to collect, directly or indirectly,
debts owed or due or asserted to be owed or due another.” C.R.S. § 12-14-103(2)(a).

        30.    Under the FDCPA, it is unlawful for any person to “[c]onduct the business of a
collection agency or advertise or solicit, either in print, by letter, in person, or otherwise, the
right to make collection or obtain payment of any debt on behalf of another without having
obtained a license” to do so. C.R.S. § 12-14-115(1)(a).

        31.    Moreover, “[a]ny person acting as a collection agency must possess a valid
license issued by the administrator . . . .” C.R.S. § 12-14-118.

       32.     Defendants have conducted the business of, and acted as, a collection agency in
Colorado after failing to renew their license to do so.

       33.      Therefore, Defendants have violated these provisions of the FDCPA.

        34.     As a result of Defendants’ violations of the FDCPA, the Administrator is entitled
to injunctive relief preliminarily and permanently restraining Defendants, and their officers,
directors, agents, servants, employees, attorneys, heirs, successors, and assigns, from engaging,
directly or indirectly, in consumer debt collection or otherwise acting as a collection agency
without a license or otherwise committing any of the acts, conduct, transactions, or violations
described above, or otherwise violating the FDCPA, together with all such other relief as may be
required to completely compensate or restore to their original position all consumers injured or
prevent unjust enrichment of any person, by reason or through the use or employment of such
practices, acts, conduct, or violations, or as may otherwise be appropriate, including, without
limitation, requiring Defendants to disgorge to the Administrator or refund to consumers all
amounts collected in violation of the FDCPA. C.R.S. § 12-14-135.

                           SECOND CLAIM FOR RELIEF
                    VIOLATIONS OF FDCPA (C.R.S. § 12-14-115(1)(b))

       35.    The Administrator incorporates by reference the allegations of paragraphs 1
through 34 above as if fully set forth herein.



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        36.   Under the FDCPA, it is unlawful for any person to “[c]onduct the business of a
collection agency under any name other than that under which licensed.” C.R.S. § 12-14-
115(1)(b).

       37.    As fully set forth above, Defendants have violated this provision by conducting
business under the name “Office of Ron Kennedy.”

        38.     As a result of Defendants’ violations of the FDCPA, the Administrator is entitled
to injunctive relief preliminarily and permanently restraining Defendants, and their officers,
directors, agents, servants, employees, attorneys, heirs, successors, and assigns, from engaging,
directly or indirectly, in consumer debt collection or otherwise acting as a collection agency
without a license or otherwise committing any of the acts, conduct, transactions, or violations
described above, or otherwise violating the FDCPA, together with all such other relief as may be
required to completely compensate or restore to their original position all consumers injured or
prevent unjust enrichment of any person, by reason or through the use or employment of such
practices, acts, conduct, or violations, or as may otherwise be appropriate, including, without
limitation, requiring Defendants to disgorge to the Administrator or refund to consumers all
amounts collected in violation of the FDCPA. C.R.S. § 12-14-135.

                            THIRD CLAIM FOR RELIEF
                     VIOLATIONS OF FDCPA (C.R.S. § 12-14-109(1))

       39.    The Administrator incorporates by reference the allegations of paragraphs 1
through 38 above as if fully set forth herein.

       40.     Per the FDCPA, collection agencies must send out an Initial Notification
containing the information set forth in C.R.S. § 12-14-109(1).

         41.  The collection agency must send the Initial Notification within five days after the
initial communication with a consumer in connection with the collection of a debt. C.R.S. § 12-
14-109(1).

        42.    Defendants have violated and continue to violate C.R.S. § 12-14-109(1) by failing
to provide consumers with the requisite Initial Notification.

        43.    As a result of Defendants’ violations of the FDCPA, the Administrator is entitled
to injunctive relief preliminarily and permanently restraining Defendants, and their officers,
directors, agents, servants, employees, attorneys, heirs, successors, and assigns, from engaging,
directly or indirectly, in consumer debt collection or otherwise acting as a collection agency
without a license or otherwise committing any of the acts, conduct, transactions, or violations
described above, or otherwise violating the FDCPA, together with all such other relief as may be
required to completely compensate or restore to their original position all consumers injured or
prevent unjust enrichment of any person, by reason or through the use or employment of such
                                               6
practices, acts, conduct, or violations, or as may otherwise be appropriate, including, without
limitation, requiring Defendants to disgorge to the Administrator or refund to consumers all
amounts collected in violation of the FDCPA. C.R.S. § 12-14-135.

                            FOURTH CLAIM FOR RELIEF
                      VIOLATIONS OF FDCPA (C.R.S. § 12-14-109(2))

       44.    The Administrator incorporates by reference the allegations of paragraphs 1
through 43 above as if fully set forth herein.

        45.     The FDCPA mandates that if a consumer notifies a collection agency in writing
within thirty days that the debt, or any portion thereof, is disputed, or that the consumer requests
the name and address of the original creditor, the collection agency must cease collection of the
debt until the collection agency obtains verification of the debt or a copy of the judgment or the
name and address of the original creditor and mails a copy of such verification or judgment or
name and address of the original creditor to the consumer.

        46.    Defendants have violated and continue to violate C.R.S. § 12-14-109(2) by failing
to provide a verification in accordance with the statute.

        47.     As a result of Defendants’ violations of the FDCPA, the Administrator is entitled
to injunctive relief preliminarily and permanently restraining Defendants, and their officers,
directors, agents, servants, employees, attorneys, heirs, successors, and assigns, from engaging,
directly or indirectly, in consumer debt collection or otherwise acting as a collection agency
without a license or otherwise committing any of the acts, conduct, transactions, or violations
described above, or otherwise violating the FDCPA, together with all such other relief as may be
required to completely compensate or restore to their original position all consumers injured or
prevent unjust enrichment of any person, by reason or through the use or employment of such
practices, acts, conduct, or violations, or as may otherwise be appropriate, including, without
limitation, requiring Defendants to disgorge to the Administrator or refund to consumers all
amounts collected in violation of the FDCPA. C.R.S. § 12-14-135.

                            FIFTH CLAIM FOR RELIEF
                      VIOLATIONS OF CCPA (C.R.S. § 6-1-105(1)(z))

       48.      Plaintiffs incorporate by reference the allegations of paragraphs 1 through 47
above as if fully set forth herein.

       49.     Under the CCPA, a person engages in a deceptive trade practice when, in the
course of such person’s business, such person engages in any business without a license required
to engage in the business. C.R.S. § 6-1-105(1)(z).


                                                 7
       50.     Regent failed, and continues to fail, to obtain all governmental licenses required
to engage in debt collection.

        51.     As a result of Defendants’ violations of the CCPA, the Attorney General is
entitled to injunctive relief, consumer restitution, disgorgement, civil penalties, and attorneys’
fees and costs. C.R.S. §§ 6-1-110, 6-1-112, and 6-1-113.

                                   PRAYER FOR RELIEF

      ACCORDINGLY, Plaintiffs pray for entry of judgment in their favor and against
Defendants, and request the Court provide the following relief:

        A.      Issue a preliminary and permanent injunction, enjoining Defendants, and their
officers, directors, agents, servants, employees, attorneys, heirs, successors, and assigns, from:

               1.     Engaging, directly or indirectly, in consumer debt collection or otherwise
                      acting as a collection agency without a license or otherwise committing
                      any of the acts, conduct, transactions, or violations described above, or
                      otherwise violating the FDCPA; and

               2.     Engaging in deceptive trade practices, in the course of their business
                      activities, in violation of the CCPA.

        B.     Impose civil penalties against Defendants under C.R.S. § 6-1-112.

        C.     Award actual damages to those injured by the violations of the FDCPA and the
CCPA.

        D.     Order Defendants to make restitution of money to the persons aggrieved by the
violations.

       E.    Order Defendants to disgorge all profits from their unlawful activities in the State
of Colorado.

        F.     Award costs, expenses, and attorneys’ fees incurred by Plaintiffs.

        G.     Award pre- and post-judgment interest.

        H.     Award such other relief as the Court deems proper and just.


Dated this the 29th day of November 2010.

                                                8
                                         JOHN W. SUTHERS
                                         Attorney General

                                         s/ Jeanine M. Anderson
                                         JEANINE M. ANDERSON, 28206*
                                         Assistant Attorney General
                                         Consumer Credit Unit
                                         Consumer Protection Section
                                         Attorneys for PLAINTIFFS

                                         *Counsel of Record




Pursuant to C.R.C.P. 121, § 1-26(7), the original of this document with original signatures is
maintained in the Offices of the Colorado Attorney General, 1525 Sherman Street, Seventh
Floor, Denver, Colorado 80203, and will be made available for inspection by other parties or
the Court upon request.




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