MelHarris has drawn attacks from consumer advocates over its debt-collection practices, which include filing more than 100, 000 lawsuits in state courts around the country.
To get judgments against the borrowers, the judge said, a single MelHarris employee named Todd Fabacher signed 40, 000 affidavits attesting to the accuracy of debt claims.
The customer for these services was Leucadia, a financial-services firm that bought hundreds of thousands of defaulted debt claims for pennies on the dollar and hired MelHarris to recover what it could.
The lawsuit on behalf of up to 100, 000 borrowers claims lawyers at MelHarris then used those statements to obtain default judgments against the consumers and threaten to garnish their wages or freeze money in their bank accounts.