FTC Issues Payments to Consumers Impacted by Fraudulent Debt Collection Scheme
The payments are the result of 2015 charges against a group of defendants who collected debts consumers reportedly did not owe.
7/27/2018 9:50 AM
The Federal Trade Commission is issuing restitution to consumers allegedly subject to paying debts they did not owe after it and the New York Attorney General charged a group of defendants, Delaware Solutions, for unlawfully seeking payment for the alleged debts in 2015.
The FTC will issue 597 checks totaling more than $184,000 to the consumers, according to a news release.
In October 2015, the FTC and the State of New York charged Delaware Solutions with collecting on debts that they knew were not owed, according to the news release. “According to the complaint, the defendants ignored evidence that the debts were invalid, failed to identify themselves as debt collectors, falsely portrayed themselves as process servers or attorneys, and falsely threatened arrest or litigation for failure to pay,” it states. The defendants agreed to—and in August 2016, a federal court in New York entered—an order that permanently banned them from the debt collection industry.
ACA International continues to support industry and law enforcement efforts to target bad actors who commit these actions and eradicate them from the consumer financial marketplace. ACA has long led the effort to stop criminal activity and has worked consistently with the FTC and other regulators to help them understand the differences between legitimate debt collectors and illegal actors claiming to be part of the industry.
“Legitimate debt collectors operate lawfully and respectfully and take great efforts to ensure compliance. On the other hand, fraudulent and unlawful actors posing as debt collectors have no interest in complying with the law; instead they harm consumers and generate a mistrust of debt collectors which unfairly tarnishes the entire industry,” said ACA International’s Vice President and Senior Counsel of Federal Advocacy Leah Dempsey.
It is critical that the FTC continue its focus on egregious conduct and debt collection scam operations that cause the most harm to consumers, and differentiate those bad actors from the overwhelming majority of debt collectors who operate lawfully, take consumer protection seriously and play a unique and much-needed role in our credit-based economy.
ACA looks forward to working with the FTC and other government agencies to continue to educate them about the services provided by those lawfully collecting debts compared to the harm caused by illegal actors.
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