Federal Trade Commission

Debt Collector Allied Interstate Pays $1.75 Million Fine

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In an effort to resolve federal allegations, debt collector Allied Interstate has agreed to pay a $1.75 million dollar fine. Allied Interstate was accused of collecting on debts that people did not actually owe, contacting third parties, and threatening legal action that it did not intend to take.

Unsurprisingly, this type of behavior is illegal.

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Debt Collection News Roundup, Week of June 12th, 2010

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This week began with a bang, in the form of the Federal Trade Commission’s report that consumer complaints about debt collection abuses have tripled. The FTC also released a report, Repairing A Broken System: Protecting Consumers in Debt Collection Litigation and Arbitration in which it criticized the one-two punch of debt collection and mandatory binding arbitration.

The New York Times popped in on Tuesday with a report that at least one New York law firm is filing 80,000 lawsuits per year, enough to put a serious strain on the New York court system. Minnesota Senator Al Franked pointed out to the Federal Trade Commission that the same sort of monkey business is going on in Minnesota, and asked the FTC to take action now and through future regulation. Minnesota legislators also promise to fix the broken debt collection system.

Update: the FTC says it is going to look into debt collectors who are jailing debtors in Minnesota. No report on whether the FTC will look into the other allegations of abuse Senator Franken mentioned.

Oh, and surprise of surprises, a Chicago debt collection law firm, stopped paying its own bills. When asked if it could borrow the money from a friend or family member, the firm had no comment.

But we didn’t even get to all the news this week. We still haven’t weighed in on the sweeping (?) financial reform that Congress finally got around to. And if you just can’t get enough debt collection news, here is a sprinkling of links on the Office of the Comptroller of Currency, which is (apparently) charged with protecting banks from state laws, and on the Military Lending Act, which isn’t actually helping members of the military escape scammers and loan-shark-sized interest rates service fees.

Al Franken: “Debt Collection Firms Abuse Minnesotans To Reap Profits”

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Minnesota Senator Al Franken issued a press release today demanding that the Federal Trade Commission take action to reign in illegal debt collection activity. Here is the press release:

Update: the FTC says it is going to look into debt collectors who are jailing debtors in Minnesota. No report on whether the FTC will look into the other allegations of abuse Senator Franken mentioned.

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Get Off Junk Mailing Lists—If You Have Some Time On Your Hands

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If you, like 100% of American households, are getting a lot of junk mail, here is one way to get rid of it. A Consumerist reader reports great results calling his junk mailers every hour, on the hour, asking for the company they got his address from, as well as requesting them to take him off their list.

It may take a day or two of calling, but he says they always cave in the end. Then he starts over with the company who gave out the information, tracking the list back to its source and removing his name from all the lists along the way.

He calls it “Blitz Calling,” and it sounds like a good project for a slow work week.

If you do this, be sure to write down the names of the companies you call so that you have a record that you asked them to stop. You may need it when it comes time to file a complaint with the Federal Trade Commission.

Get Off Junk Mail Lists With Blitz Calling | Consumerist

Use AnnualCreditReport.com for Free Credit Reports

If you want a free copy of your credit report, head over to AnnualCreditReport.com, which was setup by the Federal Trade Commission.

Thanks to Congress passing the Credit Card Accountability Responsibility and Disclosure Act of 2009, the ads should be a more clear in the future. FreeCreditReport will now have large disclosure ads on their website that say something like “You have the right to a free credit report from AnnualCreditReport.com . . . the only authorized source under federal law . . . .”

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What Debt Collectors Can and Cannot Do

The Federal Trade Commission has posted a video on their website and YouTube outlining consumers’ rights when contacted by debt collectors.

If you have been contacted by a debt collector, watching the video is a good place to start learning about your rights.

(photo: bisgovuk)

More Consumer Rights On the Way?

A new report from the Government Accountability Office (GAO) urges legislators to revise the Fair Debt Collection and Practices Act (FDCPA) to give consumers more rights.

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Debt Collection Cheatsheet

The FTC has a great, four-page overview of consumer rights relating to debt collection. Some of their tips include:

  1. Debt collectors can only contact you between the hours of 8AM and 9PM.
  2. If you want to stop debt collectors from contacting you, you must make a request in writing. Once the debt collector receives your letter, they can only contact you for two reasons: (1) to tell you they will no longer contact you; and/or (2) to inform you they intend to take a specific action—like filing a lawsuit.
  3. Broadly speaking, debt collectors cannot make any false statements when they speak with you.

If you have any questions or concerns about communications from debt collectors, contact the FTC or a consumer rights lawyer in your state.

Debt Collection FAQs: A Guide for Consumers| Federal Trade Commission

(photo: Desirée Delgado)

Federal Trade Commission Accepting Public Comments on Debt Collection Litigation

On Tuesday, the FTC will hold a free roundtable in San Francisco, open to the public, on debt collection litigation and arbitration. The FTC is seeking public comments in advance of the event, and some of the existing public comments are, well, interesting.

Debt buyers Midland Credit Management, Asset Acceptance, and Portfolio Recovery Associates whine that they are subjected to a higher standard in litigation. I thought their public comments very funny, and very misleading.

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