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Collection of Fake Payday Debts?

Posted on November 18, 2013 in

The debt buying and collection industry has been growing for years.  Increasing at even greater rate it seems is the prevalence of fraudulent and untraceable debt collection companies.  These companies call consumers and threaten legal action will be taken, often within 24-48 hours if the consumer does not return their call and make a payment.  An internet search of the company’s name – if they leave one or of the phone number – if it isn’t blocked which called the consumer generally is fruitless, leaving consumers confused and concerned about the false, threatening and illegal message.

Recently, the Federal Trade Commission (“FTC”) brought an action against a group of these companies in Federal Court in Georgia. According to the Complaint, the defendants used various names in the computer generated robocalls and messages to consumers, including but not limited to, Global Legal Services and United Judgment & Appeals.  These fictitious businesses, which imply an association with the law, further instill fear into consumers to pay on debts which often times they do not owe.  The Complaint also alleged the robocalls and voicemails threatened lawsuits and arrests unless the consumers responded within a few days.  More disconcerting is the allegation made by the FTC that these companies collected millions of dollars in phantom debts.  The FTC recently prevailed in having a Judge temporarily shut down this particular group of companies.  While the FTC case appears to be a success for consumers, there are dozens if not hundreds more of these companies operating around the country.

If you are being contacted by a debt collector who you believe is attempting to collect a “fake” or “phantom” debt visit our website at cogburnlaw.com or call us at 702-384-3616 to obtain additional information and legal advice on your consumer rights.