It should be good news that the Federal Trade Commission has cracked down on a company that was (allegedly) making illegal collection calls to debtors and not bothering to verify the debt in the first place. Multiple violations of the Fair Debt Collection Practices Act should not go unpunished, and a $3.2 million fine is pretty steep — it is the largest fine, in fact, that the FTC has ever imposed on a third-party debt collector.
So, really, it is good news. It would be better news, though, if people in Maryland and other states who had been the victims of this company’s alleged unscrupulous practices would also benefit from the FTC action.
Such, however, is the nature of regulators. They impose fines on companies like this one — Expert Global Solutions, the world’s largest debt collection firm — and threaten them with more fines if they continue to harass debtors or consumers the company says are debtors. The FTC’s action should, however, protect consumers from future harassment by the company.
The FTC’s complaint accuses the Expert and its affiliates of calling consumers at all hours of the day, calling them multiple times during the day and calling them at work. If consumers denied owing the debt, the FTC says, the company continued to try to collect.
If the court approves the FTC’s proposed order, Expert will have to listen when a consumer denies that he owes the debt or owes that much on the account. In either case, Expert will have to close the account and stop collection efforts, or hold off on collecting the debt until the validity and accuracy of the debt have been verified.
The order also requires that the company no longer
- “Harass, oppress or abuse” a consumer during the collection process.
- Communicate with third parties about a consumer’s debt.
- Call a consumer at his workplace if it is either inconvenient or against the employer’s policies.
- Stop calling a consumer, in most circumstances, if the consumer refuses to pay.
The company also must record at least 75 percent of its collection calls and not dispose of the recordings for 90 days. This provision will not take effect for one year after the order is signed.
If you are being harassed by creditors or a collection company, you may want to contact a personal bankruptcy attorney to discuss your options.
Source: Collections & Credit Risk, “Collections Giant Will Pay Record Penalty in Settlement,” Darren Waggoner, July 9, 2013