FTC holding debt collectors accountable for illegal practices
Debt collection companies are prohibited from using abusive tactics to collect debt. Despite consumer protection laws, many debt collection companies still use illegal practices when contacting debtors.
The Federal Trade Commission is cracking down on debt collectors. A recent case shows just how serious the U.S. government is taking illegal debt collection practices. The U.S. government recently shut down four companies for using abusive tactics when collecting debt from consumers.
The FTC reported that they shut down these companies for using illegal practices that included harassment and threats of arrest against consumers.
The action taken by the FTC is a step in the right direction for consumers. Debt collection companies need to abide by the rules stipulated by the FTC. When they violate these rules, consumers are harmed.
As a consumer, you need to be aware of the different ways debt collectors may violate your rights when trying to collect unpaid debt. What can debt collectors not do? Listed below are the practices that are prohibited under the Fair Debt Collection Practices Act:
- Debt collectors cannot harass or abuse you or any third party they contact about your debt. This includes making threats of violence and using profane language.
- Debt collectors cannot make false statements about the debt they are trying to collect.
- Debt collectors cannot say that you will be arrested for not paying your debt. They also cannot seize or garnish your wages or property unless they are permitted by law to do so.
- Debt collectors cannot give false information about your credit, give a false name or send fake documents.
- Debt collectors cannot collect interest or fees unless the law allows them to do so.
- Debt collectors cannot contact you by postcard, take or threaten to take your property or deposit a check early.
An lawyer will protect your rights and make sure you are treated fairly. If you have been the victim of creditor harassment, contact a lawyer right away.
Source: Reuters, “Four U.S. debt collectors shut down for illegal practices – FTC,” Nov. 4, 2015