Abusive Collection Agency Shut Down; Employees Arrested

Federal agents halted operations and arrested the owner and six employees of an abusive collection agency in Georgia on November 18, 2014.  The arrests were the result of a joint investigation by the FBI, Consumer Financial Protection Bureau, and the Federal Trade Commission.  The agency and its employees are accused of using abusive, deceptive tactics and making false threats to consumers to coerce them to pay.

More information about the investigation: CNN Money


Creditors can utilize many legal tactics to collect debts from consumers, but they cannot make threats of arrest or criminal prosecution, or identify themselves as part of a public agency associated with the police or US Government.  If you get a call or contact from a debt collector, make sure you understand what debt they are collecting.  Watch out for anyone who uses “red flag” statements like:

  • “If you don’t pay this debt, we will send the police to your home/office with a warrant for your arrest.”
  • “You are guilty of check fraud/theft by deception/fraud.  If you don’t pay, you’ll go to jail.”
  • “We won’t send you a notice.  You have to pay now by phone or we’ll sue you.”
  • “You’ll be arrested for tax fraud if you don’t pay immediately.”

A reputable agency would never use threats like these to collect a valid debt.  While creditors can file a lawsuit to collect a valid debt from you, that doesn’t turn the debt into a criminal matter.  If you are uncertain about the debt or collection agency, always ask the creditor to provide you with written verification of the debt.

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