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Aggressive debt collectors fined $1 million

Menacing text messages and threatening phone calls led to a Federal Trade Commission investigation into a company called the National Attorney Service. In the first case to deal directly with unlawful text messages being sent by a debt collector, the FTC fined the company $1 million for violating debt collection regulations.

Those who have faced large amounts of debt and have been through the collections process in the past know how stressful and even frightening this type of contact can be. In this case the conduct is all the more shocking because the debt collection firm was lying about potential consequences to failing to pay back the debt and using overly aggressive tactics obviously designed to frighten people into paying. This is against the law, thus the $1 million penalty.

A spokesperson from the FTC said that they have seen an increasing number of complaints in which debt collectors pose as or suggest that they are attorneys or law firms. About 30 percent of the complaints they receive involve this type of conduct.

In this case, the National Attorney Service is not a law firm or a legal business but rather a straightforward debt collection firm. Part of the settlement with the FTC requires that the company stop using this name or other similar names that mislead consumers.

This case brings up a few important issues for those who are seeking debt relief. First, make sure that you independently verify the legitimacy of a claim by a debt collector who contacts you. Second, make sure that you know your rights when it comes to debt collection and the options for insuring that the aggressive calls, letters, emails, and text messages stop. And finally, make sure anyone offering legal services is in fact a licensed attorney in good standing. 

 

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

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