Private Counsel Debt Collection - Northern District of Texas

PRIVATE COUNSEL DEBT COLLECTION – NORTHERN DISTRICT OF TEXAS STATEMENT OF WORK Background The policy of the Federal Government is to make every effort to collect delinquent debts owed to the United States. In furtherance of this policy, Congress, in 1986, enacted the Federal Debt Recovery Act (FDRA), P.L. 99-578, 31 U.S.C. sec. 3718(b). The FDRA originally authorized a pilot project for three years, in which the Attorney General was to contract with private counsel to assist the U.S. Attorneys in collecting debts owed to the United States, in not less than five nor more than ten Federal Judicial Districts. The FDRA has been amended three times: First in 1990 by P.L. 101-302, which extended the pilot through September 30, 1992; again in 1992 by P.L. 102- 589, which extended the pilot through September 30, 1996, and authorized its expansion to "not more than 15" Federal Judicial Districts; and most recently, on April 26, 1996, by Sections 31001(cc) (1) and (2) of Public Law 104-134. This latest amendment eliminates any requirement that the Attorney General try to award four (4) contracts to private counsel in each district, and repeals Sections 3 and 5 of the FDRA, so that the Attorney General now has permanent authority to contract with as few or as many private counsel in as many judicial districts as deemed appropriate. The use of private counsel to collect delinquent debts was a significant departure from the Federal Government's previous debt collection policy. The U.S. Attorneys have historically been responsible for the collection of most delinquent debts referred by client agencies to the Department of Justice (DOJ or Department) for litigation and collection. For the most part, these debts were the result of direct, guaranteed, or insured loans made, or benefits conferred, pursuant to a variety of Federal programs administered by any of several client agencies including, but not limited to, the Departments of Agriculture, Education, Housing and Urban Development, Health and Human Services, Veterans Affairs, and the Small Business Administration. These agencies may not refer claims to DOJ for litigation until they have exhausted, without success, a series of administrative remedies to try to collect them. The procedures Federal agencies must follow in trying to collect, compromise, or settle their debts administratively, before they can refer them to DOJ for litigation, are set out in the Federal Claims Collection Standards 31 C.F.R., Parts 900 – 904. The Federal agencies, as well as private collection agencies on behalf of those agencies, will have attempted to collect on most, if not all, of the unsecured debts that are forwarded to DOJ for litigation and referred to private counsel. Many of these cases result in default or consent judgments against the debtors. Scope The private counsel (Contractor) shall furnish all legal services, including representation in negotiation, compromise, settlement, and litigation, to collect delinquent debts owed to the United States. Such services include the collection and litigation of secured and unsecured Federal debts and participation in bankruptcy, foreclosure, and other ancillary proceedings as may be required. The Contractor may undertake collection of delinquent non-tax civil debts referred to the DOJ for collection from Federal agencies, or that may originate from litigation at the Department or other DOJ components. All of the work to be performed under this contract must be performed within the counties that comprise the United States Federal Judicial Districts, and all litigation to collect secured and unsecured debts must be brought in the United States District Court in the same judicial district in which the debtor is located, unless the case is a foreclosure and the United States Attorney’s Office determines in consultation with the Contractor that it is more efficient for foreclosure matters to be filed in state or local courts. Applicable Statutes, Regulations, Executive Orders, Standards and Rules All collection, litigation, and enforcement efforts on the part of the Contractor shall comply and be consistent with all Federal, state, and local statutes, regulations, Executive Orders, applicable state and local Bar rules, procedures, and opinions, and the highest ethical and professional standards which apply to the collection of debts and credit reporting. These include but are not limited to the following: Federal Debt Collection Procedures Act of 1990 (28 U.S.C. §§ 3001-3307); Federal Claims Collection Standards 31 C.F.R. Parts 900-904; Privacy Act of 1974, as amended (5 U.S.C. § 552a); Fair Debt Collection Practices Act (15 U.S.C. §§ 1692a-1692o); Debt Collection Act of 1982, as amended (31 U.S.C. §§ 3701-3720E); Fair Credit Reporting Act (15 U.S.C. §§ 1681a-1681u); Federal Debt Recovery Act (31 U.S.C. § 3718; as amended); Consumer Credit Protection Act (15 U.S.C. §§ 1671-1679) Model Rules of Professional Conduct; Service Members Civil Relief Act (50 U.S.C. App. §§ 501—597b); Executive Order No. 12988, 61 FR 4729, 1996 WL 46665 (Pres.); Federal Rules of Civil Procedure; Federal Rules of Bankruptcy Procedure; Applicable case law in the Contractor’s jurisdiction; and, All applicable local rules and procedures promulgated by the United States District Courts and the individual Federal judges in the judicial districts. These statutes and standards, as well as any other applicable Federal and state laws, rules and regulations pertaining to debt collection practices of particular agencies, or the Government as a whole, and any updated revisions to those statutes and standards, laws, rules and regulations, are incorporated by reference into this statement of work and will be considered part of the contract. Violation of any applicable laws, rules, regulations, or ethical standards will be sufficient cause for termination of the contract for default. If the Contractor is the subject of a claim …