When it comes to con artist audacity, Bernie Madoff has nothing on Michael J. Covatto, president of Unicredit America, the (fortunately) now defunct collections firm from Erie, Pennsylvania.
According to Pennsylvania’s Attorney General Linda Kelly Unicredit America (also called Unicredit Debt Resolution Center) decorated a company office to look like a courtroom and then held “hearings” designed to intimidate and frighten debtors into making payments or surrendering valuables.
The scam went so far as to hand deliver court appearance notices by a person disguised to look like a sheriff’s deputy, which conveyed (not so subtly) that they would be taken into custody if they failed to show up for their “court” appearance.
These fictitious court proceedings were used to intimidate consumers into providing access to bank accounts, make immediate payments or surrendering vehicle titles and other assets – sometimes dispatching Unicredit employees to consumers’ homes in order to retrieve documents or have consumers sign payment agreements.
Fortunately an Erie judge has put an end to this by banning Covatto from the debt collection business in Pennsylvania. Soon there will be another hearing to determine what should be paid to victims and the state in the way of penalties.
This is a good first step, but it doesn’t go nearly far enough. At minimum what should happen includes:
- Covatto and all associates should be banned from the debt collection in the UNITED STATES, not just Pennsylvania. Erie is within spitting distance of Ohio, if Covatto wanted he could literally walk across the border to Cleveland, set up a shingle and do it all over again. Pennsylvania is safe from this predator, the other 49 states need to be too.
- There should be criminal charges filed. What has happened so far is all civil, and by declaring bankruptcy (which he has) Mr. Covato may likely escape making meaningful restitution for his misdeeds.
Anyone with kids knows that threat of real and enforced punishment does wonders for modifying behavior. Let debt collectors engaging in this kind of activity stare jail time in the face and I suspect they may choose a more enlightened path.
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