This is a passage that caught most people’s attention: Alert Alert Alert.. Your payment was declined due to insufficient ACH transaction… please call 866.597.3075. But this isn’t really a warning. There are no instances of payment being declined. And “ACH transaction shortfall” isn’t even real.
These are deceptive text messages sent by debt collectors to illegally lure alleged debtors into contacting them.
This is just one example of three separate cases filed as part of the Federal Trade Commission’s enforcement sweep dubbed “Money Message.” In summary, the lawsuit alleges that Unified Global Group, Premier Debt Acquisitions, The Primary Group and associated individuals and companies, scam– Utopia of deceptive claims, unfair practices, and violations of the Fair Debt Collection Practices Act. What unites them is the use of misleading text, which is just one way the FTC says some debt collectors twist their techniques to break the law.
Federal courts in New York and Georgia have ordered temporary halts to the defendants’ activities. But even at this early stage, the complaints in the Money Tips case demonstrate that for other members of the debt collection industry, there are three do’s and three don’ts and one that shouldn’t be considered at all.
Do not use deceptive text messages to collect debts. The use of words in the debt collection process is not illegal per se. But no matter how debt collectors communicate with consumers, the law still applies. One issue of particular concern in “text message collection” cases is that debt collectors use false pretenses to get consumers to contact them by sending misleading text messages. The technology may be new, but the tactic has a long and unsavory pedigree. (For example, 40 years ago, the FTC challenged the practices of encyclopedia salesmen who falsely claimed they were conducting educational surveys to really get their foot in the door.) Representing debt collection texts as anything other than debt collection Anything outside the text conflicts with established law. standard.
Be sure to identify yourself. Under Section 806(6) of the FDCPA, debt collectors must “meaningfully disclose” their identity to consumers. No lies, no lies, no lies. The FTC said some defendants violated the rule by leaving threatening voicemails without identifying themselves as debt collectors. Others declined to say who they worked for. Consumers have the right to know whether the debt collector contacting them has the right to collect the debt. The rise of dastardly ghost debt collectors makes this right even more important.
Be sure to make Mini-Miranda disclosures as required by law. Section 807(11) of the FDCPA provides for what industry insiders call “mini-Miranda.” During the initial communication with the consumer, the debt collector must disclose that he or she is attempting to collect a debt and that any information obtained will be used for that purpose. Later communications must also reveal that they came from a debt collector. The FTC said all three “money messaging” cases violated Mini-Miranda requirements.
Please follow the appropriate verification notice. Within 5 days of the initial communication with the consumer, the debt collector must send a written notice detailing certain details, including the amount of the debt, the name of the creditor, the process for disputing the debt, and other information outlined in Section 809 of the FDCPA. The FTC alleges that “money tip” defendants frequently failed to follow up on required notices. Even when consumers provide evidence that they do not owe money, some of them continue to press for payment.
Do not disclose the existence of the debt to third parties. According to the FTC, some “monetary tip” defendants spread claims to third parties that the consumers in question owed money. In addition to the very specific and narrow procedures authorized by the FDCPA, Section 805(b) makes it illegal to tell others, including friends, family, neighbors, co-workers, and employers, about a personal debt.
Please do not obtain items beyond the scope of authorization. Section 808(1) of the FDCPA makes it illegal for a debt collector to collect any amount not expressly authorized by the debt agreement or permitted by law. Prohibited categories include “any interest, fees, charges or expenses in connection with a principal obligation”. According to the FTC, a “processing fee” or “convenience fee” imposed by a company violates this part of the law.
Don’t even think about it now.
Don’t even think about falsely threatening people with arrest, jail time, lawsuits, wage garnishment, etc., or impersonating someone from the government or legal system. Let’s get this out of the way right away: Debt collectors can’t arrest people for not paying private debts, so threatening arrest or imprisonment is illegal. But that hasn’t stopped some defendants from acting as if arrest is imminent. According to one complaint, a debt collector told a consumer that police would be dispatched to her husband’s workplace to arrest him for “bank fraud.” Some defendants increased the credibility of their threats by suggesting false relationships with government agencies.An example of the FTC allegation: a voicemail left for a consumer or family member claiming to be from an “office of a state official” threatening to send “a uniformed officer [the consumer’s] home or place of work to enforce this physical attachment. ” Defendants often ended these messages with instructions to “protect the safety of any large animals or firearms on the premises.” As the Money Message complaint illustrates, it is also illegal to threaten a consumer with a civil lawsuit if the debt collector has not filed or has no intention of filing a civil lawsuit. Don’t even consider claiming a false connection to the judicial process.For example, the FTC said that in one case, a defendant falsely claimed: “I am a process server for Primary Solutions appointed to serve you with documents in your case. [eight-digit number]. . ”. Other defendants lied to consumers about their relationships with attorneys or law firms. Bottom line: False bravado and impersonation violate the FDCPA and FTC Act.
