Calif. debt firm settles Pa. class-action suit Eds: APNewsNow. Will be led.

By DAN NEPHIN Associated Press Writer PITTSBURGH (AP) A California debt collection company has agreed to pay $2.55 million to settle a lawsuit brought by thousands of Pennsylvanians who claim they were wrongly led to believe they had to pay costly fees to avoid criminal charges for bouncing checks.

American Corrective Counseling Services admits no wrongdoing as part of the settlement approved Monday in bankruptcy court in Delaware.

The company sent letters purporting to be from various Pennsylvania district attorneys' offices to people who bounced checks.

The letters indicated that a crime had been committed because the checks bounced. But the letters say that the check bouncers would avoid penalty by paying off the checks and various fees and by attending a financial accountability class.

A company attorney declined to comment.

(Copyright 2009 by The Associated Press. All Rights Reserved.) APNP 11-03-09 1427CST | save this article / add to your favorites list