BBB alerts Tennessee’s public to fraudulent, aggressive collection calls
Posted: Friday, September 10, 2010 8:01 pm
Memphis — The BBB is warning consumers to be on the alert for scam artists posing as collectors of nonexistent payday loan debts. The scammers typically call consumers and threaten them with legal action or arrest unless the victims authorize immediate payments from their bank accounts.
A Munford woman didn’t expect to be threatened when she answered her cell phone, but that’s exactly what she got. The caller said he was calling about an unpaid payday loan from April 2009. “He said if I didn’t pay him immediately, the police would come and lock me up,” the woman told the BBB. “He said he would be there with the police when they came to arrest me.”
That collection call came from Allen Watson with United Law Service. The Munford woman has never had a loan with them. She refused to pay and called the BBB for help. Consumers across the country have complained about similar calls, although the caller and company names are different.
“Phony debt collectors employ a variety of scare tactics in an attempt to commit theft,” said Randy Hutchinson, BBB president. “The Fair Debt Collection Practices Act (FDCPA) prohibits legitimate debt collectors from using abusive, unfair or deceptive practices to collect from you.”
According to the Federal Trade Commission (FTC), which enforces the FDCPA, debt collectors may not use threats of violence or harm, and they are prohibited from saying that you will be arrested if you don’t pay a debt. Collection agencies in the state are also licensed and regulated by the Tennessee Collection Service Board.
The BBB urged those who receive a suspicious debt collection call to remember the following advice:
Avoid providing personal information. Do not verify or give out personal information over the telephone, including bank account or credit card numbers.
Demand proof. Ask for verification of the debt. Debt collectors are required to send you a written “validation notice” telling you how much money you owe within five days after they first contact you. This notice also must include the name of the creditor to whom you owe the money, and how to proceed if you don’t think you owe the money.
Report all suspicious behavior. Report abusive, threatening or illegal collection practices by filing complaints with the BBB at http://www.memphis.bbb.org/, the FTC at http://www.ftc.gov/ and the Tennessee Collection Service Board at http://tn.gov/commerce/boards/collect/complaint.shtml.