Receiving a telephone call from a debt collector is not a pleasant experience. Being hounded by someone attempting to collect a debt you do not owe constitutes fraud. The Federal Trade Commission (FTC) settled a complaint that they had brought against Lamar Snow, Global Processing Solutions LLC, Intrinsic Solutions LLC, North Center Collections, Inc., Diverse Financial Enterprises, Inc., Jahaan McDuffie, Capital Security Investments, LLC, American Credit Adjusters LLC and Glentis Wallace, all of which the FTC accused of using false claims and threats to compel people to pay debts which were largely either non-existent or which the defendants had no authority to collect. They also violated federal law by illegally contacting the employers of the people who they hounded for debt payments and failed to provide proper notices and disclaimers also required by federal law. Under the terms of the settlement the defendants are prohibited from the debt collection business and must pay a multi million dollar judgment, the payment of which is largely suspended due to the representations that the defendants are essentially without assets. If the defendants misrepresented their financial condition, the full judgment will become due immediately. As is common in FTC settlements while the defendants agreed to the settlement, they did not admit any wrong doing which is tantamount to the defendants saying that they did nothing wrong and promise not to do it again.

Here is a link to all of the documents in the FTC’s action against these defendants.

Subject to strict federal laws, legitimate debt collectors are permitted to call debtors, however, the law prohibits them from threatening imprisonment for the failure to pay a debt and attempting to collect a debt that the debt collector knows is bogus. The law also prohibits debt collectors from communicating information about a debt to the consumer’s employer although they can contact the employer merely to obtain contact information about the employee

It can be difficult to know when someone calls attempting to collect a debt if indeed they are legitimate or not, so the best course of action if you receive such a call is to not discuss the debt with the person calling, but instead demand that they send you a written “validation notice” by regular mail which describes the debt they allege you owe and includes a listing of your rights under the Federal Fair Debt Collection Practices Act.  Never give personal information over the phone to anyone who calls you attempting to collect a debt. You can never be sure who they are.  If you receive the validation notice and it appears to be legitimate, you may be better off contacting your creditor directly because the person who called you may not be representing the creditor, but may merely have information about the debt.

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