Recently we have been receiving numerous calls from consumers stating that
collection law firms or agencies are telling them to simply sign a “conditional
release” with their bank to unfreeze their levied accounts. This
is a deceiving new tactic which allows the bank to completely release
all levied funds in a consumer’s bank account to the alleged creditor
owed. Most consumers do not understand the language or what the effects
of signing the paperwork are. They are just told that it will release
the levy on their account.
Our client had $48,000 frozen in his savings account because of a default
Malen & Associates, a debt-collection law firm, was able to obtain on behalf of their client,
Regional Adjustment Bureau or RAB, a debt-buyer. When his account was
frozen, he called Malen and the representatives there told him to simply
go to his bank and sign the “conditional release.” This would
unfreeze his account and get everything back to normal.
Our client did indeed sign the form but felt that something really wrong
had happened so he immediately called our office for a free consultation.
After discussing the case we told him to call his bank and tell them to
stop the transaction from proceeding. He did so and the bank was able
to stop the transaction in the nick of time. We contacted Malen &
Associates and sent them a copy of the Order to Show Cause that we would
be filing on behalf of our client if they chose not to vacate the judgment
We notified them that we would also ask the judge to dismiss the case as
we did not think that they would be able to provide proof of the assignment
of the debt from Citibank, the original owner, to RAB to prove standing.
Not only did Malen agree to vacate the judgment but they also agreed to
settle the underlying debt matter for $4,700 in total, a hefty reduction
off of the full amount of $48,000. Our client was ecstatic as he had almost
signed away $48,000 a few days prior because of the deceiving nature of
the instructions received from Malen and RAB.