In recent months, I have been contacted by a number of people who have fallen victim to debt collection scams. The essence of the scam is as follows: the victim gets contacted by a “debt collector,” who claims that the victim owes money, and must pay immediately. The request for payment is usually accompanied by threats, including threats of criminal charges or arrest. The scammers use different methods of communication, including phone, letters, and email. Unfortunately, many people fall for these threats and pay up, only to find out later (e.g. after talking to a lawyer) that they were scammed. What is even worse is that if the person really owes the debt, he or she will still owe that debt after paying the scammer. In order to avoid being taken in by a scammer, keep the following things in mind when dealing with debt collectors.
How do the debt collection scammers choose their victims?
Debt collection scammers can choose their victims randomly, or without consideration of whether the person actually owes any debt. However, in my experience, many victims of collection scams in fact have outstanding debt. People with outstanding debt already feel under pressure, often feel bad about not being able to pay their debts, and are therefore easier to take advantage of. Many people with a number of different debts may not remember the name of each of their creditors, especially if the debts are old or have been transferred, which again makes it easier for the scammers to perpetrate their scams. However, keep in mind that some scammers will claim that they are collecting on behalf of a legitimate creditor to which the victim owes money, even though in fact they have no relationship with that creditor.
How can I tell if I am being scammed by a debt collector?
There are a few things to look out for when you are contacted by a debt collector. Look especially for the following:
Are you familiar with the alleged debt? If you’ve never heard of the debt that the debt collector claims you owe, and you are generally familiar with your debts, then chances are you are being scammed. At a minimum, you need to request supporting documentation for the alleged debt.
Are you being threatened with arrest, criminal charges, or the police being called? If the answer is yes, then you are almost certainly being scammed. You cannot be arrested for not paying a debt, and there are no debtors’ prisons in the United States. A debt collector cannot file criminal charges against you (only the government can file criminal charges), and simply not paying a debt is not a crime. And police cannot be called on you for non-payment of debt. More importantly, threats like those described in this paragraph likely constitute a violation of the Fair Debt Collection Practices Act and other laws, and give you a right to sue the debt collector for damages, which means it is unlikely that legitimate debt collectors will use such tactics. This being said, you should keep in mind that if a court enters a judgment against you for a debt, that judgment can be collected by, among other things, seizing your property. Therefore, you should never ignore any documents that come from a court.
Are you being contacted by email? While technology is always advancing and things may change in the future, I have so far never seen a legitimate debt collector trying to collect the debt by email.
Are there grammatical errors or awkward phrasing in the written collection notices (letters and emails)? If you receive a collection letter or email that contains numerous grammatical errors, awkward phrasing, improper usage of common words, or generally looks like it was not written by a native English speaker, chances are very good that you are being scammed. Most scammers are not located in the US (because if they were they would likely be prosecuted for numerous criminal violations), and their collection notices usually make this very apparent.
Does the debt collector refuse or avoid answering your questions about the alleged debt? If you are being contacted by phone, you should always get as much information as possible about the alleged debt. If the debt collector refuses to give you information, or tells you that they don’t have to give you any information, or avoids answering your questions, then it is likely that you are being scammed. Legitimate debt collectors will provide information about the debt, and will provide it in writing as well.
What do I do if I think I am being scammed by a debt collector?
If you think you are being scammed, you need to get as much information as possible, so that you can either verify what you are being told, or determine that it in fact is a scam. If you are contacted by phone, get, at a minimum, the caller’s name, company, company address, and phone number (the caller ID number is not always correct). Also request written documentation of the debt. However, be careful about giving out your address, as a legitimate debt collector should already have it.
If you are contacted by letter or email, request written verification of the debt. If you are not familiar with the debt collector, also request written information on who was the original creditor, as well as written proof that the debt collector purchased or otherwise acquired the debt.
Don’t pay any alleged debt if you are not certain that you owe it, and if you are not sure that the debt collector who contacted you has authority to collect it.
Of course, the best way to determine whether a particular alleged debt should be paid is to consult a qualified attorney in your area.
The above is provided for general informational purposes only. It is not intended to and does not constitute legal advice, and does not create an attorney-client relationship. If you need legal advice for your specific situation, you should contact a qualified attorney in your area.