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Bill collectors need to be careful what they say

Wisconsin readers may be interested to know that National Attorney Collection Services, Inc. has agreed to pay a $1 million fine for illegal collection practices. They used text messages to harass people who were struggling with debt, which is not necessarily illegal. However, the people sending the messages presented themselves as lawyers or paralegals and didn't reveal that they were actually working for a collections firm.

In addition to posing as lawyers, the employees also sent messages to friends, neighbors and employers in an effort to shame the consumer into paying the money they were alleged to owe. According to the Federal Trade Commission, it is a violation of the law governing fair collection practices. The company also broke the law when they used envelopes depicting a man upside down have his pockets shaken out by Uncle Sam. For privacy issues, the law doesn't allow collection companies to reveal there is a debt notice in the envelope.

In addition to the fine, the company is required to change the name of their business so it no longer gives the impression that they are lawyers. They are also being closely watched for any collection activities that violate the Fair Debt Collection Practices Act.

Collection Agencies must follow strict rules when attempting to collect debts. It may be useful to allow a bankruptcy attorney to review the situation if an individual feels he or she is being harassed by a collection agency. An attorney can assess the situation and decide whether the company should be reported to the FTC. There may also be a chance of collecting monetary damages from the collection company for their violations.

Source: Daily Finance, "Text-Messaging Debt Collector Hit With $1 Million Fine for Posing as Law Firm", Matt Brownell, September 25, 2013

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