I am paying creditor through Money Management International on a monthly basis. They take from my account $387.50 per month and divide it among my creditors. However, the person who is collecting the debt does not recognize them, but ahe company is accepting the payments and cashing the check.

Here is the problem... you are paying the Debt management company... your creditors have no obligation to accept what they offer or consider what they do pay (if anything as there are bad apples out there) as payment in full.

What is happening is they are getting less than they consider a full payment... and aren't happy with it so they are sueing for it.

Remember this intermediary you are using (by your own choice) is not bound to the places you owe money to by any agreement they have made or are obligated to accept. Just because a third party is cashing a check... doesn't mean your debtors are accepting it. It's a far different thing then if they accepted and cashed a check themselves that YOU made out directly to them.

Because this hasn't been mentioned yet... was this Debt management Program agreed to by your creditors under some form of arbitration agreement with them collectively?