The State Bar of Georgia is investigating a controversial debt-collecting attorney in Cobb County for possible violations of the Bar's professional rules of conduct.
CBS46 News obtained a letter from the Bar dated April 2, which indicates an investigative panel will determine whether Fred J. Hanna violated five rules, including truthfulness in statements, respect for rights of third persons and misconduct.
The investigation stems from a complaint filed by Eduardo Austin of Sandy Springs who alleged Hanna's law firm tried to garnish his wages illegally.
"It's predatory," said Austin. "Fred Hanna saw this an opportunity to get more revenue."
Hanna's firm has long been the target of complaints. CBS46 News has learned consumers have filed 556 complaints against Hanna with the Governor's Office of Consumer Protection since 2009. Those complaints alleged violations of federal debt collection laws like harassment and attempts to collect on satisfied debts.
But the Office of Consumer Protection can't do anything about the complaints. The Georgia Supreme Court ruled only the State Bar and the Federal Trade Commission can crack down on attorneys who violate rules.
Georgia Bar General Counsel Paula Frederick wouldn't tell CBS46 investigative reporter Jeff Chirico how many complaints it has received about Hanna. The Bar does not release information about complaints or investigations unless they result in public action.
But Chirico has learned at least one complaint against Hanna wasn't investigated by the Bar. Consumer attorney Larry Silverman told Chirico that he filed a complaint in 2010 after he learned Hanna's firm falsified affidavits that it had submitted to the court.
"I wrote a letter to the Bar Counsel. I sent in examples of these false affidavits that I had discovered and I never heard anything after that," said Silverman. "Why the Bar won't go further with it in the face of so many complaints, I just don't understand."
As CBS46 reported in February, Fred J. Hanna & Associates garnished Austin's wages in 2010 for an unpaid Discover Card account. Over three months in 2010, Austin repaid the entire $3300 balance to the Fulton County State Court registry. The funds should have been transferred to Hanna's firm but weren't.
The court corrected the issue and sent a payment to Hanna's firm in February 2013.
After Hanna received the payments, his firm went after Austin again for $970 --interest accrued during the three years that the court held the money.
Austin fought the garnishment and a Gwinnett County judge ruled Hanna's firm was not entitled to the additional money.
Court Administrator Cicely Barber confirmed that garnishments collected from 1,900 individuals sat in the court account in some cases for years. Barber blamed office inefficiencies and an antiquated computer system.
Hanna's firm has maintained Georgia law allows the firm to collect post-judgment interest.
Austin's attorney Steve Koval said he does not believe the law allows debt collectors to charge interest when the debtor has no control over the transfer of funds.
"This is beyond the normal pigginess I see with debt collectors," said Koval.
Austin filed a federal lawsuit against Hanna.
The firm's managing partner Joseph Cooling had no comment.
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