Home Consumer Feds Crackdown On Debt Collectors

Feds Crackdown On Debt Collectors

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By Al Sunshine, SouthFloridaReporter.com, Consumer Investigator, Nov. 20, 2015 – Been bothered by Bill Collectors? You may want to remind them of your rights and let them know about a major nationwide crack down by the Feds against 4 of the biggest “debt collection” companies in the country. Formal actions were filed against:

  • Bam Financial
  • Delaware Solutions
  • K.I.P., LLC
  • National Check Registry

The FTC alleges “In one instance, the defendants falsely told a consumer’s 84 year-old mother they had a warrant for her daughter’s arrest, and later told the consumer they represented a bounty hunter and would have the sheriff serve her with process. The defendants falsely told another consumer that she would not be allowed to see her children, and that they would garnish her wages and report her to the Internal Revenue Service if she did not pay.”

The FTC is also seeking several million dollars back for consumers scammed by these companies.

What practices are off limits for debt collectors?

  1. Harassment.
  2. Debt collectors may not harass, oppress, or abuse you or any third parties they contact.  For example, they may not:
    • use threats of violence or harm;
    • publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
      use obscene or profane language;
      repeatedly use the phone to annoy someone.

False statements.

Debt collectors may not lie when they are trying to collect a debt. For example, they may not:

  • falsely claim that they are attorneys or government representatives;
  • falsely claim that you have committed a crime;
  • falsely represent that they operate or work for a credit reporting company;
  • misrepresent the amount you owe;
  • indicate that papers they send you are legal forms if they aren’t;
  • indicate that papers they send to you aren’t legal forms if they are.

Debt collectors also are prohibited from saying that:

  • you will be arrested if you don’t pay your debt;
  • they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so;
  • legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.

Debt collectors may not give false credit information about you to anyone, including a credit reporting company; send you anything that looks like an official document from a court or government agency if it isn’t; or use a false company name.

Unfair practices.

Debt collectors may not engage in unfair practices when they try to collect a debt. For example:

  1. they may not try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;
  2. deposit a post-dated check early;
  3. take or threaten to take your property unless it can be done legally;
  4. contact you by postcard.
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You can find the complete Federal Trade Commission release HERE

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Al Sunshine is a South Florida-based Broadcast and Digital Journalist whose career has spanned more than 40 years at the local and national levels. His award-winning investigations have triggered more than a dozen state and local consumer protection laws and his work’s been cited in Congressional Testimony before the U-S House of Representatives. He is best known for his “Shame On You” features for CBS Miami which sought to expose businesses, agencies and individuals defrauding or deceiving consumers, as well as endangering the safety and welfare of the general public. In 2013 Al retired from CBS Miami to set up his own Digital News Business, “Sunshine News, LLC” and Al continues to blog for the Radio, Television, Digital News Association, sponsors of the prestigious Edward R. Murrow Awards”. An avid environmentalist, Al is one of the founding members of the “Miami Pine Rocklands Coalition”. The Florida Non-Profit is fighting to save and restore the last 2% of Pine Rocklands found only in South Florida and nowhere else in the continental United States. Al was recently elected its President.