It is very important for debt collectors to only engage in proper conduct in their debt collection efforts. In today’s difficult economy, consumers have enough on their plates without also having to worry about having to be subjected to wrongful debt collection conduct. Wrongful debt collection conduct can be very harmful to consumers.
Recently, a settlement was reached in a case involving allegations of wrongful debt collection practices. The case involved a company that buys consumer debt from organizations like credit card companies.
The Federal Trade Commission (FTC) accused the company of having engaged in wrongful and deceptive practices in some of its efforts to collect on debt that it had purchased. For example, the company was accused of having, in regards to debt that had passed the statute of limitations, led consumers to think that they could be sued if they didn’t repay the debt. The FTC also claimed that the company would sometimes send credit reporting agencies incorrect information regarding consumer debts that it had purchased.
The FTC brought a lawsuit in a federal court in Florida against the company in connection to these allegations. Recently, the FTC and the company reached a settlement in regards to this lawsuit. In this settlement, the company reportedly agreed to pay a large civil penalty.
Consumers can suffer great harm when they are subjected to wrongful debt collection conduct like that alleged in this recently settled case. Thus, one hopes that all debt collectors make sure to only engage in proper practices when engaging in debt collection efforts. One also hopes that governments at the state and federal level do what they can to protect consumers from wrongful debt collection conduct.
Source: Reuters, “US regulators penalize debt collector for deception,” Jan. 30, 2012