Do You Feel Helpless Against Debt Collectors?
A Recent Case Illustrates That Debt Collection Agencies Are Bound by the Fair Debt Collection Practices Act
Individuals who are subject to harassment by a debt collection agency often feel powerless, either because they can’t pay the money they owe or because they believe they do not owe the money claimed but simply can’t prove it. This sense of impotence can be exacerbated when the debt collection agency makes threats, demands the payment of additional fees or falsely claims to be acting on behalf of an attorney.
Although it may seem like a hopeless cause, consumers do in fact have rights in debt collection disputes as illustrated by a recent case which held that debt collection agencies’ tactics are subject to the Fair Debt Collection Practices Act (FDCPA).
In 2012, the Federal Trade Commission (FTC) filed suit against the owners of California-based Rincon Debt Management. Court documents revealed that the FTC accused Rincon of posing as lawyers, threatening consumers with lawsuits and arrest as well as demanding and collecting illegal fees it had no right to accept.
On March 28, a California court ordered Rincon’s owners to pay $3.3 million to Rincon’s victims. According to an FTC staff attorney, Rincon’s debt collection practices were patently illegal and essentially constituted fraud, because they “preyed upon people’s ignorance about the process” to “collect extra fees that the consumer didn’t owe and the collector wasn’t entitled to.”
Numerous consumers who felt powerless in the face of Rincon’s excesses will now receive compensation and an equitable outcome following the debt collection-related harassment. If you have been harassed by an aggressive creditor, remember that, under the FDCPA and other laws, threats of lawsuits and arrest are illegal, as are:
- Using profane language
- Attempting to embarrass you by telling your co-workers, boss, friends or family that you owe money
- Contacting you once you have hired a debt collection or bankruptcy attorney
If you need additional information regarding your rights as a consumer when dealing with debt collectors, or if you have questions regarding debt reduction or bankruptcy, contact the Orange, Riverside and Alameda, California law firm of Fitzgerald Campbell, A Professional Law Corporation. Call (866) 927-8289.
Posted in: Collection Harassment