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Brooklyn Resident’s Legal Settlement with Debt Collection Law Firm Likely to Benefit Thousands of New Yorkers


CONTACT: Susan Shin, 212-680-5100

Brooklyn Resident’s Legal Settlement with Debt Collection Law Firm 
Likely to Benefit Thousands of New Yorkers

Ditmas Park resident Romain Prage today successfully settled a lawsuit he filed in 2016 against debt collection firm Kavulich and Associates, securing redress not only for himself but also potentially for thousands of other New Yorkers whose benefits are exempt from debt collection.

Mr. Prage’s lawsuit alleged that the Kavulich law firm violated federal and state consumer protection laws when it kept his bank account frozen for nearly four months and repeatedly lied to him about his rights, in an attempt to squeeze money out of him. His bank account contained only unemployment insurance benefits, which are exempt from debt collection.

“This settlement gives me an enormous sense of relief,” said Mr. Prage. “For the past few years, I’ve lived in fear that my bank account would again be improperly frozen, and that I’d have to go through this same ordeal all over again.”

“The defendants violated federal and state law when they told Mr. Prage that his unemployment insurance benefits were not exempt from debt collection,” said Susan Shin, Legal Director at New Economy Project, which brought the lawsuit with co-counsel on Mr. Prage’s behalf. “Thanks to this settlement, the Kavulich law firm won’t be able to do this kind of thing to anyone else.”

“By keeping his bank account frozen for so long, Kavulich repeatedly and unjustifiably undermined Mr. Prage’s ability to pay his bills and put food on the table,” said Ahmad Kesharvarz, co-counsel for Mr. Prage.

The lawsuit alleges violations of New York’s Exempt Income Protection Act (EIPA), enacted in 2008 to stop debt collectors from unlawfully freezing New Yorkers’ bank accounts and seizing their subsistence income. “We fought for this law precisely to protect people in situations like Mr. Prage’s. By improperly restraining Mr. Prage’s exempt funds, Kavulich flouted the very spirit and purpose of the EIPA,” said Shin.

New Economy Project filed the lawsuit on Mr. Prage’s behalf, with co-counsel, The Law Office of Ahmad Keshavarz, in the U.S. District Court for the Eastern District of New York. New Economy Project operates the NYC Financial Justice Hotline, a free legal assistance program for low-income New York City residents aggrieved by discriminatory and abusive financial practices.