Scam Alert: The Fake Debt Collector

money gremlin

Real debt collectors are bad enough, but recently these guys have added a new scam to their repertoire:

Collecting on fake debts.

They call, sometimes outside the legal bounds…

They threaten, often WAAAAY outside the legal limits… 

They know stuff about you - personal details - and threaten to make your life hell if you don’t pay them, NOW.

Money Tree

These callers may be teeing off from legit collection agencies - certainly the tactics they use were probably developed during stints at real agencies and they don’t just call randomly. They may purchase old lists of debtors or have access to customer files from payday or car title lenders to get at folks who are vulnerable.

Another great reason never to borrow money from those modern day loan sharks!

According to a recent complaint filed by the FTC, the fake collectors:

“...threatened to garnish wages, and they offered to accept, or “settle the debt,” for significantly less than the amount allegedly owed. In addition, the caller didn’t give the person any proof of the debt — even when asked.”

Unfortunately, the scammers are so convincing that many victims made payments even though they didn’t owe. So, even if you don’t fit the most vulnerable target type, knowing what to do if you receive a call from a collector (legit or not) can protect you and your bank account.

5 tips for standing up to these scammers:

#1 Ask the caller for his name, company, street address, and telephone number. Tell the caller you won’t discuss any debt until you get a written "validation notice." If the caller refuses, don’t pay, and hang up and block the number (but be aware that they’ll just call from another phone number if they think there’s any chance of getting money from you).

​#2 Make your request in writing. The Fair Debt Collection Practices Act, FDCPA, requires any debt collector to stop calling if you ask them to, in writing. If the debt is real, sending a letter does not get rid of the debt, but it should stop the calls.

#3 Don’t give or confirm any personal, financial, or other sensitive information. Just refer back to rule #1.

#4 Contact your creditor. If a debt is legitimate – but you think the collector isn’t — contact the company you owe the money to and set up a real payment plan. 

#5 Report the call. File a complaint with the FTC and your state's Attorney general's office. Do this, even if you’ve already given them money. You may help put these guys in jail!

And, watch this short video the FTC made to help us combat this scam:

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