The Federal Trade Commission announced recently that defendants in a debt collection scheme frequently targeting Spanish-speaking consumers will not only be required to pay a $3.3 million penalty, but will also be barred from doing future business.
Our Miami consumer lawyers have learned that the settlement agreement involves the two primary owners of Rincon Debt Management, who stood accused of violations of the Fair Debt Collection Practices Act, as well as the Federal Trade Commission Act.
Specifically, the company targeted calls to debtors’ family, friends, employers and neighbors. In doing so, collectors pretended to be delivering legal papers relative to a pending lawsuit. In some instances, the defendants were reportedly threatened with arrest if they failed to respond to the collection firm’s calls. Also, the two defendants, as well as their staffers, pretended to be attorneys – or employees of a law firm – and demanded that consumers pay legal fees and legal costs. This was despite the fact that in almost all cases, there was no pending lawsuit. In fact, there were many instances in which it was later revealed that the consumer didn’t owe the debt at all.
Herein lies one of the most important lessons that consumers can take away from these cases: It pays to fight back – or at least have the case investigated by an experienced consumer lawyer. Even if the debt collection agency is collecting on a legitimate debt, their tactics may be illegal. You may not actually owe as much as they are demanding. In some cases, even if you technically owe the debt, the statute of limitations may have run out or the collection firm may not be able to effectively link the debt to you in court.
The fact of the matter is, at some point in life, almost everyone deals with debt. As little as two missed payments can result in the involvement of a debt collection firm. Usually, these are third party companies that purchase your debt for pennies of what is actually owed. Often, they fail to fully verify the debts before they start the collections process.
Given that April is National Financial Literacy Month, it’s an appropriate time to make debtors aware of their rights the next time a collection agency comes knocking. Here’s what you should know:
- You are protected under both state and federal laws. Specifically, the Fair Credit Reporting Act and the Fair Debt Collection Practices Act.
- Ignoring or dodging debt collections firms will not make them go away. If anything, they will become more aggressive – and you may be setting yourself up for a possible default judgment if you fail to respond appropriately to threatened legal action. The best way to handle these situations is to have your case reviewed by an attorney who can best explore your options.
- Under the law, a debt collector is not allowed to reveal information regarding the debt to anyone other than you and your attorney. The collector must verify your information before revealing any specifics of your debt.
- You have the right to dispute the validity of a debt.
- If you are an active military member, you are entitled to special protections under the Service Member Civil Relief Act. This may allow you to postpone, suspend and possibly even purge certain debts.
You should also know that you don’t have to handle this alone.
If you’re battling debt or foreclosure in Miami or the surrounding areas contact Jacobs Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Debt Warriors with Bruce Jacobs,” discussing foreclosure topics that matter to YOU.
FTC: Deceptive Debt Collectors Must Pay $3.3 Million In Consumer Refunds, April 3, 2014, By Ashlee Kieler, The Consumerist
More Blog Entries:
Mortgage Fraud Settlement Terms “Satisfied,” With Unsatisfying Results, April 1, 2014, Miami Consumer Protection Lawyer Blog