Debt Collectors Need to Play by the Rules

by Sonya Smith-Valentine, Valentine Legal Group on April 11, 2013

If you’re behind in paying your bills, you may be contacted by a debt collector — someone who regularly collects debts owed to others. This includes collection agencies, lawyers who collect debts on a regular basis, and companies that buy delinquent debts and then try to collect them.

You have the right to be treated fairly by debt collectors. Under federal law, they can’t use abusive, deceptive or unfair practices to collect from you. But not all debt collectors play by the rules. In fact, the FTC recently settled a case against Rumson, Bolling & Associates, a debt collection company that berated people with obscene and profane language, threatened them with physical harm, told their employers, co-workers, neighbors, and other people about their debts, and falsely threatened them with lawsuits, arrest, seizure of their property, or wage garnishment. All of these actions are against the law, and the FTC has seen to it that abusers pay dearly. The company is permanently banned from the debt collection business and has agreed to pay more than a million dollars in judgments.

It’s important to understand your rights if you’re ever contacted by a debt collector. And if you believe a collector has violated those rights, make sure to visit our page on debt collection for more information.

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Bogus Text Messages Offering Prizes

by Sonya Smith-Valentine, Valentine Legal Group on March 27, 2013

If you’ve ever gotten a text message on your cell phone telling you that you’ve won a free prize, you’re not alone. During the past year, the FTC has gotten tens of thousands of complaints about unsolicited text messages.

Many of the messages claim that you’ve won a free prize, and feature a link to a website. If you click on the link, you reach a site that supposedly offers the free merchandise. But to get the “free” prize, you have to reveal a lot of personal information — and maybe some money, too. Some of the sites require you to sign up for dietary supplements, skin care products, book of the month clubs, credit cards, government grants, or identity theft protection — most of which require you to pay a shipping fee and cancel a membership within a certain time to avoid being charged monthly.

That you have to share personal information and pay isn’t disclosed until you’ve been drawn into the scam.

Bottomline: “Free” merchandise websites rarely live up to their promises, if ever. Need proof? The FTC recently brought eight cases against 29 defendants who sent illegal spam texts and falsely claimed that prizes or gifts were free.

Mostly, the consumers who dealt with the scam artists involved in the FTC cases never got the free gift they were promised. Many people abandoned the websites once they realized they hadn’t won anything and that the offer for “free” merchandise required them to pay.

But the scam still worked because most people clicked into the website, entering personal information or completing some offers — and generating income for the free merchandise website operators before they quit. The website operators sold the consumers’ information to other marketers and earned commissions from those running the offers advertised on the sites.

When you see a spam text offering a gift, a gift card, or a ‘free’ service, do yourself a favor:

Delete any text that asks you to confirm or provide personal information: Legitimate companies don’t ask for information like your account numbers or passwords by email or text.

Don’t reply, and don’t click on links in the message: Links can install malware on your computer and take you to spoof sites that look real but whose purpose is to steal your information

by Colleen Tressler

Consumer Education Specialist, FTC

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But I Never Ordered Anything…

March 12, 2013

What if a company called you, demanding you pay for a product they said you ordered? What if they threatened you if you didn’t pay? And what if you never actually ordered that product, never even saw it, and never promised to pay for anything? A recently-filed FTC case claims that Instant Response Systems, a […]

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Attorney of the Month

January 3, 2013

Hyatt Legal Plans recognizes Sonya Smith-Valentine as January’s Attorney of the Month. A satisfied plan member contacted Hyatt to let us know about the outstanding experience he had while working with Sonya.   You can read Hyatt’s Attorney Spotlight for January 2013 here.

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Worldwide Asset Cases in Maryland District Court Dismissed

October 12, 2012

Maryland’s District Court Chief Judge dismissed 3,168 debt collection cases against Maryland residents. The Judge’s order follows a settlement and final order in a federal class action against Worldwide Asset Purchasing issued by U.S. District Court. In the federal case, it was alleged that Worldwide was not properly registered or licensed, misstated amounts owed and […]

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Stop Robocalling Me!

September 18, 2012

The FTC has filed a complaint against Nelson Gamble & Associates LLC, Jackson Hunter Morris & Knight LLC, BlackRock Professional Corporation, and Mekhia Capital LLC alleging that the companies’ recorded sales pitches claimed to be “public service announcements.” People were told that because President Obama wants to help consumers get out of debt, people can settle for 50% or less […]

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Maryland Reaches Settlement With LVNV Funding For Violations

July 9, 2012

The Maryland State Collection Agency Licensing Board has reached an agreement with LVNV Funding LLC and Resurgent Capital Services, L.P. to settle alleged violations of federal and state debt collection laws. The settlement includes a penalty of $1 million, agreement to dismiss more than 3,500 cases pending in Maryland district courts having balances of over […]

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TCPA Class Action against AllianceOne Settled

May 29, 2012

The is a significant settlement with a debt collection agency in a case involving automated dialers and messages used to contact consumers on cell phones. The case against AllianceOne Receivables Management, Inc. is a class action. The lawsuit alleges that AllianceOne violated the Telephone Consumer Protection Act (TCPA) by calling cell phones using an automated dialer or with […]

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FTC Halts “Free Gas For Life” Scam

May 24, 2012

The Federal Trade Commission put a stop to an online operation that allegedly lured consumers with a supposedly “free” book falsely promising that it would show them how to power their cars and homes at no cost, and then billed them for an online magazine they never ordered. The defendants behind the alleged scam have […]

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Bank Sells Credit Card Debts with Faulty Records

April 19, 2012

A recent article in the American Banker highlights some of the problems with practice of selling old debts to debt buying companies.  It appears Bank of America (just like many other banks) sold portfolios of credit card debt to CACH LLC.  A portion of the debt sold was either discharged in bankruptcy or already repaid.  The […]

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