Buffalo bill collecting

Share This Page

Beef on weck, frozen custard – and one of the largest debt collection industries in the U.S. Those are some of the things Buffalo is known for. That’s why the FTC kicked off its continuing Debt Collection Dialogue in Buffalo on June 15, 2015. Hosted with the New York State Attorney General’s Office, the event brought law enforcers, industry representatives, and consumer advocates together to talk about recent enforcement actions, consumer complaints, and compliance issues. If you couldn’t make it, here’s our informal take on what attendees talked about.

Dealing with debt collectors is a day-to-day experience for many Americans.  According to some studies, 15% of consumers – nearly 30 million people – have an account in collections. And we’re not talking nickels and dimes. The average is more than $5,100.

Recent law enforcement actions have focused on some particularly egregious practices.  Why the uptick in debt collection enforcement? Because some companies have stepped way over the lines set out in federal and state debt collection laws. Among the allegations in recent FTC complaints were that the defendants:

  • lied to consumers that they would be arrested if they didn’t pay the alleged debts quickly;
  • pretended to work for government agencies, including the FBI and other federal and state law enforcers;
  • threatened to sue people when they had no intention of filing;
  • called consumers’ family members, friends, and co-workers and told them about the alleged debts;
  • hounded people about debts they either never owed or had already paid off; and
  • sent text messages that violated the Fair Debt Collection Practices Act.

Bad apples in the industry are making things harder for consumers struggling to stay afloat – and for legitimate companies trying to comply with the law.  In certain circles, the current state of affairs has created a perfect storm of non-compliance. Many consumers are behind on their bills, some of those debts are getting harder and harder to collect, there’s questionable paper for sale, and a workforce of more than 450,000 collectors are making close to a billion consumer contacts each year. Those are just some of the factors that led to the 283,000 debt collection complaints the FTC received in 2014 alone. The harm to consumers should be obvious, but lawless debt collectors also damage the reputation – and the bottom line – for industry members who follow the rules.

Data security and integrity should be important industry priorities.  The security of personal information is a concern in every sector of the economy and debt collection is no exception. The FTC went to court last year to challenge the practices of debt brokers who posted portfolios for sale in a way that publicly disclosed sensitive information. That would be bad in any circumstance, but phantom debt collectors compound the impact of slipshod security. When fraudsters get access to account details, it’s easier for them to impersonate the company authorized to collect the debt. That puts consumers in a deeper financial hole and makes it harder for legitimate collectors to do their job. An FTC publication, Buying or selling debts? Steps for keeping data secure, offers guidance for industry members. The accuracy of information matters, too. Portfolios filled with outdated or incorrect data undermine the entire system.

Federal and state agencies stand united in the fight against illegal debt collection.  Through the Fair Debt Collection Practices Act, New York’s debt collection law and rules, and other federal and state statutes, the standards are clear for companies willing to comply with the laws – and the FTC, State AGs, and the Consumer Financial Protection Bureau coordinate their efforts to challenge the practices of companies that aren’t. One theme at the Buffalo Debt Collection Dialogue was a call for reputable collectors to lend their support by letting law enforcers know about rotten apples that are ruining the industry barrel.

The FTC will continue the conversation at Debt Collection Dialogues in Dallas and Atlanta. Check back soon for details.

 

Comments

Their was a recent scammers fraudulently get into my mail address and I apply a method by opening a different account with Gmail similar to the previous one and divert them there, instead of [email address omitted] along with my password.

My new Gmail account

Email: [omitted]

Password: [omitted]

You welcome now to check the scammers from my recent email and password, open my inbox and deal with them according to the law, after you all know about those scammers, am not using the present email/password anymore.

Disclosure: Former Collections Agent.

I'm happy to see enforcement action brought agianst those outside the law. Collections has such a negative stigma attached to it that when I placed a comment on another topic about debt collection telling people not to ignore their debt I was called a bottom feeder.That kind of hurt. I understand it's not fun to have a collector call you, but those are operating within the law will try to help set something up to get people out of debt. They're not evil people, they're just people.

Companies operating outside the law hurts everyone in the business. Take AMG who was operating in my state of Kansas (despite claiming they were in Native American territory, which Overland Park is not). They tried to flaunt the rules and got smacked down hard by the FTC. We need more of that, and having local law enforcement in the mix will help.

Add new comment

Comment Policy

Privacy Act Statement

It is your choice whether to submit a comment. If you do, you must create a user name, or we will not post your comment. The Federal Trade Commission Act authorizes this information collection for purposes of managing online comments. Comments and user names are part of the Federal Trade Commission’s (FTC) public records system (PDF), and user names also are part of the FTC’s computer user records system (PDF). We may routinely use these records as described in the FTC’s Privacy Act system notices. For more information on how the FTC handles information that we collect, please read our privacy policy.