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Forghany Law P.C.

Debt collector faces sanctions for deceptive methods

A person can feel a tremendous amount of pressure when he or she knows that bills are beginning to stack up. In this situation, it may not be clear what to do or who can be trusted. As recent action by the Federal Trade Commission shows, some organizations may try to take advantage of people in this situation.

The FTC took action against a group of companies that targeted consumers by sending text messages that contained misleading and threatening language. In the messages, the debt collection agencies threatened lawsuits and even jail time if individuals didn't immediately pay back debts.

Not only did the debt collectors send aggressive messages, but they did so under the guise of a misleading name. One of the companies was called the National Attorney Service. This led consumers to believe they were being contacted by law firms, even though this wasn't true. Officials from the FTC note that this is part of a larger trend of debt collectors posing as law firms.

The group of companies agreed to settle with the FTC. As a result, they will no longer be able to operate under misleading names and will have to pay a $1 million fine. Reports indicate that this settlement was significant because it's the first to involve collection agencies that target people using text messages.

When a person is looking for debt relief, trustworthy advice is important. Following incorrect advice or dealing with overly aggressive debt collectors could put a person in an even more difficult financial position. Pursuing strategies, such as personal bankruptcy, could help stop creditor harassment and allow for a more steady financial footing.

Source: Huffington Post, "Debt Collectors Using Terrible New Tactic Get Fined $1 Million," Chris Kirkham, Sept. 26, 2013. 

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