We’ve heard it before: A debt collection company engaged in a “phantom” debt scheme in which they try to entice unsuspecting individuals into paying debts they don’t actually owe. While federal regulators have cracked down on these unscrupulous organizations in the past, they are now turning their attention to the companies providing information on these supposed debts. To that end, the Federal Trade Commission today ordered one such data company to pay $4.1 million. [More]
debt collection
Sketchy Debt Relief Company Accused Of Impersonating Federal Agency
By 10.13.17
In a sweet case of karma, a debt relief operation that claimed to wipe away consumers’ debt through an affiliation with the Consumer Financial Protection Bureau has been sued by none other than that exact same agency. [More]
Jeweler, Wife Face Criminal Charges Of Preying On Military Servicemembers
By 10.3.17
Among unethical retailers, there’s a certain subset of predators that target members of the armed forces and their family. The latest example: A California couple who pushed military personnel to finance their purchases with a related business, then allegedly made illegal threats when customers fell behind on their bills.
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Student Lender, Debt Collector To Refund More Than $3.5M To Borrowers
By 9.18.17 — Updated: 9.19.17
Two months after private student loan lender National Collegiate Student Loan Trust came under scrutiny amid reports that the company, along with its debt collector TransWorld, filed illegal student loan debt collection lawsuits against defaulted borrowers without citing proper or correct paperwork, federal regulators have ordered the companies to pay $21.6 million in refunds and penalties, and revise their collection practices. [More]
Feds Shut Down Debt Collector That Allegedly Collected $2.1M In Unowed Debts
By 8.31.17
Once again, as part of its ongoing efforts to crack down on unscrupulous debt collectors, the Federal Trade Commission has accused a North Carolina company of running a “phantom” debt collection scheme that went after people for money that they did not actually owe. [More]
Debt Collector Accused Of Taking Money From People Who Didn’t Owe Anything
By 6.23.17
As part of its ongoing efforts to crack down on unscrupulous debt collectors, the Federal Trade Commission has accused a North Carolina company of running a “phantom” debt collection scheme that went after people for money that they did not actually owe. [More]
Feds Sue Debt Collector That Allegedly Misrepresented Attorney Involvement
By 4.17.17 — Updated: 5.9.17
Under the Fair Debt Collection Practices Act, it is illegal for debt collection firms to use false, deceptive, or misleading representations to collect a debt. One Ohio company apparently didn’t follow this rule when sending consumers letters that claimed attorneys were involved in the collection of their debts, and now it’s facing a lawsuit from federal regulators. [More]
Navient Claims It’s Under No Obligation To Help Student Loan Borrowers
By 4.3.17 — Updated: 5.10.17
Navient, the largest student loan servicer in the country, is here to simply collect your monthly education loan payments, not help you find ways to more easily afford those payments. [More]
Student Loan Debt Collectors Not Eager To Charge Fees Reinstated By Trump Administration
By 3.30.17
The Department of Education recently advised companies that collect debt on billions of dollars in outstanding federal student loans that they can once again charge a large penalty fee to defaulted borrowers. However, the collectors — even one that is currently suing the government for the right to charge this fee — now say they will not automatically add thousands of dollars in additional debt to loans in default. [More]
Former Lobbyist, Son Of Student Loan Debt-Collector, Resigns From Dept. Of Education
By 3.22.17
In our recent story on the Trump administration’s decision to roll back protections for potentially millions of student loan borrowers, we also told you about new Department of Education advisor Taylor Hansen, a former lobbyist for the for-profit college industry whose father is the CEO of a student loan debt collection company that has been suing Taylor’s new employer since 2015 for the right to charge thousands of dollars in fees to people who are already having trouble paying back their loans. Now comes news that Hansen’s brief life as a federal employee has come to an end. [More]
Feds Sue Debt Relief Law Firm For Charging Customers Illegal Fees
By 1.30.17
Nearly four years ago, federal regulators shut down a debt relief company — Morgan Drexen — accused of deceiving customers with promises of reducing their debt and charging illegal upfront fees to do so. While that company eventually paid $170 million to resolve the allegations, the Consumer Financial Protection Bureau Monday sued a related company using the same playbook. [More]
1-In-4 Consumers Contacted By Debt Collectors Feel Threatened
By 1.12.17
More than 70 million Americans are contacted by a debt collector or creditor each year. While those debt collectors have a job — to get borrowers to repay on their overdue debts — some have used illegal tactics, such as threatening lawsuits, arrests, or contacting consumers’ employers or family members. Now, a new report by the Consumer Financial Protection Bureau finds that harassment by these collectors is all too common. [More]
Navy Federal Credit Union Ordered To Pay $28.5M Over Bad Debt Collection Practices
By 10.11.16
Navy Federal Credit Union offers customers — current and former military servicemembers and their families — a wide range of financial products and services, including loans that must be repaid. But when those customers fell behind on those payments, federal regulators allege that NFCU illegally threatened borrowers and restricted access to their accounts. To resolve these allegations, the company must now pay $28.5 million in refunds and penalties. [More]
More Than A Year After Corinthian Collapse, Students Still Waiting For Financial Aid Help
By 9.30.16
Eighteen months after Corinthian Colleges Inc. completed its collapse – closing the remaining Heald College, Wyotech, and Everest University – tens of thousands of former students are still waiting to received some form of relief from the mountains of student loan debt they incurred to attend the defunct college. [More]
Debt Collector Gets Out Of Lawsuit… By Buying The Lawsuit Out From Under The Plaintiff
By 8.16.16
When you sue a debt collector for allegedly violating federal law, that collector can’t just go behind your back, buy the debt on the cheap at auction and get the whole case dismissed, can it? That tactic worked for one collection agency and, depending on how a federal appeals court rules, it could lead to many other debt collectors buying their way out of legal trouble. [More]
What You Need To Know About New Rules Allowing Debt Collection Robocalls From Feds
By 8.11.16
If you ask any American to name the things they love the most, they are sure to reply, “debt collectors, intrusive pre-recorded phone calls, and the federal government!” So today — under orders to do so from a piece of rushed, tacked-on legislation — the Federal Communications Commission released its final rules allowing the federal government and some of its contractors to make debt-collection robocalls to wireless lines. [More]
New Rules Would Require Debt Collectors Have Proof You Actually Owe Money
By 7.28.16
One of the most common complaints about debt collectors is that they harass people over debts that are either no longer owed, or weren’t owed in the first place. Federal regulators are now proposing rules that — among other protections — would cut down on these annoying, bogus collections actions by requiring that debt collectors have some sort of evidence that the person they are calling actually owes money. [More]
Petition Calls On FCC To Rethink Ruling Giving All Govt. Contractors Green Light To Make Robocalls
By 7.26.16
Earlier this month, the FCC released a controversial ruling, concluding that the law allowed the federal government — and all contractors working for the government — to place prerecorded/auto-dialed robocalls to consumers, so long as the calls are made for official government business. Today, a number of consumer advocates have officially petitioned the FCC to rethink its position and close this loophole. [More]
