Debt Collection Scams
There are a number of digital scams by phone, text and even e-mail. The Federal Trade Commission (FTC) is warning consumers of these ongoing scams through their website and the media. Our Onslow County Sheriff Hans Miller just recently released a statement advising citizens to be aware of various scams and to not fall victim to them. Scammers are now using a variety of methods including debt collection, fake government officials, identity theft, phishing and pharming, fake prizes, gifts, sweepstakes, lottery scams and even buying online through Craigslist and the Facebook Marketplace.
Debt collection scams: This kind of scam is where consumers are receiving calls from threatening and harassing collectors who repeatedly attempt to collect a debt. Many consumer complaints that fall under this section are involving matters of credit and/or debit card fees, cash advances, credit repair companies and even alleging there has been unauthorized debit and credit card to use on your accounts.
How does the debt collection scam work?
Well, this scam is a straight shooter. The scammers call consumers posing as real collection agencies. Usually they have already accessed at least some of your personal information through a grand scheme of sorts with identity theft or even as far as obtaining your credit report.
How can scammers get your credit report? The NOLO Legal Online Encyclopedia says one way is, Job applicant credit reports. Which in reality, is kind of another scam in itself online. Generally, a scammer will pose as an employer or a potential employer Requesting to obtain our review your credit report as a part of the hiring process. From there the “employer” (fake) employer now proceeds to request that you use A very specific “free” credit report service through what is usually a website that appears legitimate and of course ends up costing you money. Then from that, the scammer can collect all of your personal information, steal your identity and also have your credit report.
The catch to debt collection scammers is, they will even use debts that you actually owe such as student loans, or even a credit card debt making the demand to pay immediately highly believable since it is something you identify with.
A few things to recognize to identify if you’re dealing with a debt collection scam:
- They ask you to pay right away. Be suspicious when a debt collector who suddenly seems to want to use an unusual amount of pressure, maybe even threats and other tactics to implement fear to get you to pay “today” and right away.
- They may be threatening to hit you with a lawsuit, or all of your wages will be garnished, property seized, arrest you, deportation, telling your employer, and even threaten public shaming. Credit Karma says those are signs that you are dealing with a debt collections scam.
- Will ask you to pay via wire transfer, such as Western Union or Money Gram. No legitimate debt collectors will ask you to do this. Do NOT sent money by wire!
- The debt collector is seeking a payment on a debt for a loan that you do not recognize.
- They call claims to be from the IRS and use an automated recording to tell you to call another number than what shows on your caller ID in order to settle your debt “immediately” to avoid penalty.
- The person on the call refuses to give you a mailing address or a phone number.
- The caller asks you personal financial or sensitive information such as to verify your Social Security number, birthday, as well as your address. In some calls they may even mention things like names of relatives, don’t fall for it. These things are easily accessible online through public databases such as WhitePages. A legitimate debt collector would already know all the details.
- The caller may or may not use profanity. If the caller does use profanity, that is most likely a fake call. No matter how aggressive legitimate collectors may be, the FDCPA limits what debt collectors can do when they contact debtors.
- They call you before 8 a.m. and/or after 9 p.m.
What to do if you suspect a call is from a fake debt collector?
- Ask the “debt collector for his or her first and last name, what company they are calling from, a street address (with city and state) for that company, and a telephone number with an extension if applicable to call them back directly.
- Consumers should tell the caller that you refuse to further discuss and debt until receiving a valid written notice. The FTC says these written notices MUST include the exact amount of debt, the name of the creditor you are in debt to, and a statement of your rights under the Federal Fair Debt Collection Practices Act.
- If the person on the line refuses to give you ALL of the aforementioned information, HANG UP! Do NOT pay them any money at all. Paying a fraudulent debt collector will only cost you more money, you’ll still owe the debt and the scammer will likely attempt another scam on you because you were a success.
- Stop talking to the caller! If able to obtain the caller’s address, the FTC says write a letter demanding the caller stop contacting you, make a copy and keep it in your personal files. Doing this, by law, legitimate debt collectors must stop calling you once you ask them to in writing.
*The NCAG Josh Stein says this letter will not erase the debt and the legitimate creditors can still take legal action against you for the debt owed.
- Do not give the caller any personal, sensitive or financial information. NEVER give nor confirm any personal information such as date of birth, social security number, bank account information, credit/debit card numbers, unless you are 100% certain who you are dealing with. “When in doubt, count it out.” Giving personally identifiable information puts consumers at risk of becoming victims of charges to credit cards, opening new card accounts, checking/savings accounts, writing “bad checks” even electronically, or taking out loans in your name.
- Contact your creditor. Call the original creditor that the agency says they are calling on behalf of, if it is truly an attempt on behalf of the company you owe, they can verify. If it is not, you can make them aware of the call and details.
- File a complaint report with the FTC and the state Attorney General’s office as well. A lot of states have individual sets of laws in addition to federal laws. Your states Attorney General’s office can assist in providing information on your rights per your states laws.
NC Residents can contact the NC Attorney General, Josh Steins Office toll-free at 1-877-5-NO-SCAM (1-877-566-7226) or online here.
Know your rights and know the boundaries of debt collectors by familiarizing with the FDCPA
A video from the FTC on debt collection scams:
If you feel you may have been a victim of identity theft, here are more information and options through the FTC.
To track scams through complaints with the Better Business Bureau’s tracker in your area, you can do so online here.
To file a formal complaint with the FTC, you can call the FTC’s Consumer Response Center at 1-877-FTC-HELP (1-877-382-4357) or online here.