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Debt Collector to Pay $1.75 Million

posted by Nathalie Martin

More Robo-news, this time robo- dialers.  Allied Interstate Inc., a large Minnesota debt collection agency with a history of consumer complaints, has agreed to pay $1.75 million to settle federal allegations that it broke the law by trying to collect debts people didn't owe, according to the Minneapolis Tribune today.  This is the second largest civil penalty the FTC has ever obtained against a debt collection firm. The suit brought, and the resulting settlement, send a message to the collections industry that repeatedly calling consumers who dispute a debt is not tolerated.

What are some other common collection infractions? Speaking to neighbors, co-workers or others about a consumer's debts, threatening legal action the collector does not intend to take, calling the wrong person, calling after being asked by a consumer in writing to stop calling, using foul language, and using "robo dialers," to automatically call the same people multiple times a day. With Allied, such calls continued even after people insisted the firm was calling the wrong person or that they did not owe the debt, the FTC alleged in a federal lawsuit.

Still, according to consumer attorneys, suits against collectors are few and far between and even this fine may not be enough to deter collectors. Quoting from the article above, attorney Peter berry of Minneapolis stated that  the “fine levied for this relentless abuse of consumers is tiny compared to the profits this agency made over the years engaging in that abuse."


What type of lawyer should I contact if I have evidence that a debtor acted illegally?

This isn't a regulatory matter; it is a crime. Threatening somebody with legal process who you know owes you nothing is extortion. Willful disregard is usually tantamount to knowledge in criminal law. Pattern and practice is good evidence of willful disregard.

Unfortunately, we have defined deviancy downward, at least when the deviants are wearing a suit and tie.

the problem is that they probably made 10 million by all there fraud.

geez i would pay 2 million if I could earn 10 million a year.

to really put the hurt on these firms, they need shut there doors down and fire everyone

Steve asked "What type of lawyer should I contact if I have evidence that a debtor acted illegally?" You mean if a creditor acted illegal, right? You'd need a consumer lawyer. Tell us where you live and maybe an attorney will offer his or her contact information for you. They'd likely get paid out of your recovery.

Its a nice post Nathalie.

I like the way you describe. But I don't think threatening someone with legal process is a good way.

One should consult with his lawyer if any debtor act illegally.

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