Bradstreet & Associates has bought more than $18 million in debt from Wells Fargo and U.S. Bank since 2009.
The lawsuit filed Wednesday is on behalf of 2,300 Minnesota consumers, though Minnesota Attorney General Lori Swanson said there could be up to 16,000 Minnesotans affected.
"Companies have the right to collect legitimate debt, but they shouldn't charge people for interest that isn't owed, nor should they get courts to award judgments against people for interest that isn't owed," Swanson said in a press conference Wednesday, according to the Pioneer Press.
Jennifer Dahlke, a 42-year-old social worker at the Veterans Administration hospital in Minneapolis, overdrew her U.S. Bank checking account to the tune of $2,073.
Over 15 months, she payed Bradstreet $1,500 but the firm refused to give her documentation of her payments, called her parents to tell them she was a "scumbag," and said her debt was still accruing interest at a 21.75 percent rate, Dahlke said in the press conference.
"I didn't know what I was up against," she said. "They're still harassing me."