FTC, New York Attorney General Settle with Debt Broker and Collection Agency for “Phantom Debts”
Settlement concludes case on allegations the defendants profited from collecting debts consumers did not owe.
7/1/2019 9:30 AM
Just over a year since announcing a lawsuit against defendants in a case of alleged marketing and selling of fake debts consumers did not owe, the Federal Trade Commission and New York attorney general announced a settlement permanently banning those defendants from the debt collection industry.
Hylan Asset Management LLC, a distressed consumer debt broker, its owners and Worldwide Processing Group, LLC, a third-party debt collector, are subject to the settlement and separate orders banning the defendants from debt collection activities, according to a news release from the FTC.
When there are admissible facts evidencing egregious conduct, ACA International supports law enforcement and regulators’ efforts to target bad actors, stop illegitimate debt collection activity, and safeguard consumer rights by removing known violators from the financial marketplace. ACA has worked consistently with the FTC and other regulators to help them understand the complex issues that legitimate debt collectors face, and takes pride in its frequent and varied industry compliance educational services and offerings in support of the overwhelming majority of legitimate debt collectors who operate lawfully, take consumer protection seriously and play a unique and much-needed role in our credit-based economy.
Curbing deceptive debt collection tactics across all financial products has remained a top priority for the FTC and, increasingly, state attorneys general.
Hylan Asset Management reportedly referred the debts to several collection agencies, including Worldwide Processing Group, which then reportedly collected on the debts not owed by consumers.
The defendants owe financial restitution as part of the settlement, although a majority is waived due to inability to pay. The judgment of $6.75 million for Hylan Asset Management is suspended upon payment of $676,575. The judgment of $4.94 million against Worldwide Processing Group and its owner is also suspended upon payment of $118,000.
For both settlements, the full judgment will become due immediately if the defendants are found to have misrepresented their financial conditions, according to the FTC.
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