What to do if you are contacted by a Debt Collector and you don't owe the debt
If you use credit cards, owe money on a personal loan, or are paying on a home mortgage, you are a "debtor." You may even get calls from debt collectors who say you need to pay on a debt left by a dead relative (that is a scam!). If you fall behind in repaying your credit cards, your creditors, or an error is made on your accounts, you may be contacted by a "debt collector." Yes, some people run up debts and fail to pay what they owe. But there are also debt collection agencies and debt collectors who perpetrate scams on honest people who owe nothing; and debt collectors who clearly violate the law in collecting debts. Bill collectors are now going after anyone who has the same name or a similar name to someone who owes a debt. The collectors are threatening them and ruining their credit, event though these consumers are innocent of any wrongdoing. You should know that in any situation, the Fair Debt Collection Practices Act requires that debt collectors treat you fairly and prohibits certain methods of debt collection. Of course, the law does not erase any legitimate debt you owe.
First, you need to know your rights, which are primarily spelled out in the Fair Debt Collection Act. Click on the link to read it! It is not hard to read!
Typical Real Potential Scam Situation:
See this page for another actual Debt Collection Scam Email: IAC Recovery Systems Ltd, Past Due Notice
What to do - step 1 - verify the debt
If, like the woman in the letter above, you get a letter or phone call saying you owe money, you must respond to it. First, any legitimate collection agency, must, by federal law, tell you the name of the company to whom you supposedly owe a debt. Contact that company to verify:
What to do - step 2 - reply to the debt collector
You should send a certified letter, that says you do not owe the debt and you will sue them if you are contacted again or if the debt is reported to a credit bureau. And, if they do report a debt, you can get a lawyer and sue!
Usually, just sending these scam debt collectors the following letter, by certified mail, will be enough to stop them. Of course, change the letter to use your name, the account number that the debt collector claims and the current date.
Sample Letter to Send to the Scam Debt Collector
What to do - Step 3 - File complaints!
You can file a compliant against a debt collector with the FTC - Use this form to submit a complaint to the Federal Trade Commission (FTC) Bureau of Consumer Protection about a particular company or organization.
You can also fight back with a lawsuit - First, see the answer to this question, then see Handel on the Law to find a recommended lawyer near you. You may also be able to file a lawsuit in small claims court yourself.
Here are some other steps you can take:
And let us know about it!
The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit www.ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.
Copyright CFR 2005, 2006, 2007, 2008, 2009
- Definition of scam, fraud, etc.
- Legal disclaimer / corrections
/ complaints -