Sham debt collectors play into peoples’ fears to scam them out of money and worsen their debt problems.
At the request of the FTC and the Illinois Attorney General, a federal court has shut down a network of businesses and operators that falsely claimed to be debt collectors collecting real payday loan debts. The FTC said that the operations — called Stark Law, Stark Recovery, Capital Harris Miller & Associates and other names — had no authority to collect the debts they called about. And yet, says the FTC, they relentlessly threatened and harassed people, and got millions of dollars in un-deserved payments.
According to the FTC, the companies called people who had applied for payday or other short-term loans, and then claimed their loans were delinquent. The companies intimidated people with threats of lawsuits, or having them charged with “defrauding a financial institution” for passing bad checks. For a time, the defendants even posed as a law firm, claiming they could sue people and get judgments against them. The companies called people repeatedly, and called their friends, relatives and employers, told lies — and generally made peoples’ lives miserable. Many people paid because they were worried about the consequences of not paying or just wanted the harassment to stop.
Even people deeply in debt have rights. Debt collectors aren’t allowed to harass, make false statements, or use other unfair practices. Be wary about anyone who threatens to have you arrested for an old debt-there’s a good chance he’s a fake.
The FTC exists to protect Americans from scams. In addition to information at www.legaslshredinc.com the ftc.gov is a good resource.