$1 Million Settlement in Deceptive Debt Collection Text Messaging Case

A recent press release from the Federal Trade Commission’s (FTC) Bureau of Consumer Protection reported that a debt collector violated federal law when they used misleading text messages to collect consumer debt.  The two debt collection agencies, National Attorney Collection Services, Inc. and National Attorney Services LLC, are based out of California.  However, Illinois residents are no strangers to large debt collection companies, such as CACH, Calvary SPC, or Midland Funding.

Debt collectors must abide by the Fair Debt Collection Practices Act when they seek to recover money from consumers, and when they don’t, they can beheld liable for their actions.  In the recent FTC case, the California-based debt collector agreed to pay $1 million to settle the charges that involved violations of both the Fair Debt Collection Practices Act and the FTC Act.  If you believe you have been harassed or abused by a debt collection company, you’ll need an experienced consumer advocate on your side.  The Illinois consumer attorneys at the Emerson Law Firm can discuss your case with you today.

Bureau of Consumer Protection and Fair Debt Collection Practices

The Bureau of Consumer Protection is “the nation’s consumer protection agency,” according to the website.  Through the Bureau, the FTC filters complaints about deceptive consumer practices and works with law enforcement agencies “to investigate fraud and eliminate unfair business practices.”

When a lender or third-party debt buyer violates the Fair Debt Collection Practices Act (FDCPA), the Bureau investigates and can file lawsuits against those companies.  Some key elements to know about the FDCPA include:

·      All personal, family, and household debts are covered, including credit card bills, automobile and home loans, and medical bills.  Money borrowed to run a business, however, is not covered.
·      The FDCPA prevents debt collectors from contacting you 24/7.  Under the Act, collection agencies can’t contact you at “inconvenient times or places, such as before 8 in the morning or after 9 at night, unless you agree to it.”  Debt collectors also can’t call you at work if you tell them you’re not allowed to receive their calls at your place of employment.
·      In most scenarios, debt collectors can’t harass you, lie to you, threaten you, or engage in other unfair practices.

Details of the FTC $1 Million Settlement

How did the debt collector in the recent FTC case violate the FDCPA?  In short, they made false statements to consumers in text messages and threatened those consumers.  According to the FTC press release, Archie Donovan, who controls the two debt collection companies, “used English- and Spanish-language text messages and phone calls in which [the companies] unlawfully failed to disclose that they were debt collectors.”  In addition, they sent text messages in which they falsely identified themselves as law firm, and they “falsely threatened to sue consumers for not paying their debts or to garnish their wages.”

It’s important to keep in mind that text messaging in debt collecting isn’t always illegal.  Indeed, the FTC specifically held a workshop a few years ago that “addressed how debt collectors can use text messages to collect debts in a lawful manner while maintaining consumers’ privacy.”

If you have received deceptive or harassing text messages from a debt collection company, you may be eligible for compensation.  You should contact an experienced Chicago consumer attorney today.

See Related Blog Posts:
Debt Collection Scams Prevalent, According to Chicago Better Business Bureau

Illinois AG Files New Lawsuits Targeting Companies Using Fraudulent Practices in Foreclosing on Homeowners in Crisis

Comments

Post a Comment

Popular posts from this blog

Phantom Debt Collection Scams on the Rise in Illinois

Have you been contacted by a person claiming to be a debt collector who is seeking to recover a debt you allegedly owe? If so, you are not alone. According to a recent report from CBS Chicago , such parties claiming to be debt collectors are on the rise, and they are scamming Chicago-area residents. These alleged debt collectors are part of schemes known as “phantom debt collection scams,” since they involve the attempt to collect on a debt that the consumer does not actually owe. How can you avoid becoming a victim in a debt-collection scam ? What should you do if you have been targeted by a fake debt collector? How Do Phantom Debt Collection Scams Work? Now, you might be thinking to yourself: I would never agree to make payment on a debt that I did not owe. But the scam is not always that simple. Parties at the center of debt-collection scams often target consumers who do actually owe debts (to someone or to some entity), and they prey on the fact that these c...
Read more

Payday Lending and Predatory Lenders in Illinois

If you are in substantial debt in the Chicago area and are living in a paycheck-to-paycheck cycle, you may have taken out a payday loan to make ends meet. While payday lending is illegal in a number of states due to the predatory nature of these loans, it remains legal in Illinois. As a result, many debtors in the state have used payday lenders, and far too many of those borrowers cannot repay what they owe. According to a recent article from Progress Illinois , consumers have filed complaints about payday lenders in the state, illuminating a need for federal rules that address harmful lending practices . Predatory Payday Lenders and Protections for Consumers Due to the perceived predatory nature of payday loans, twelve states in the country have banned these lenders from operating completely, according to a fact sheet from loans.org . The states that currently have laws prohibiting payday lenders from operating include Arkansas, Arizona, Connecticut, Georgia, Mary...
Read more

New Information on Debts That Bankruptcy Cannot Discharge

If you are thinking about filing for bankruptcy in the Oak Park area, it is important to know that certain kinds of debts cannot be discharged in a bankruptcy case. Under U.S. bankruptcy law, these are known as non-dischargeable debts, or exceptions to discharge. There are certain types of debts that have long been identified clearly as non-dischargeable debts, while there are misconceptions about other types of debts that may or may not be dischargeable. As an article in CNBC discusses, the U.S. Supreme Court recently issued a ruling in the case of Bartenwerfer v. Buckley , which clarifies that debts incurred due to another party’s fraud cannot be discharged in an individual’s bankruptcy case. Our Oak Park bankruptcy attorneys can explain the Court’s recent ruling and provide you with additional information on dischargeable and non-dischargeable debts. Supreme Court Says Debt Incurred Due to Another’s Fraud is Non-Dischargeable The recent Bartenwerfer case involved a debtor attempti...
Read more