Legitimate Collection Agency
Most of us would like to believe that all people are honest and can be trusted. Unfortunately, the reality is that both creditors and debtors need to be on the lookout for collection agency scams. A collection agency is a legitimate way to collect funds owed. However, creditors must use one that is reputable and debtors must know that they are giving their money to the right people.
One scam that creditors need to be wary of begins the same way any relationship with a debt collector would begin. The difference is they never hand over the payment, claiming they did not receive it or did not know who to send it to due to a clerical error. A legitimate debt collector will indicate in their contract the maximum amount of time they can hold money after collecting it.
A creditor who is concerned with making sure their agency is legitimate should look for a few simple signs. A valid agency will adhere to the general rules set for all collectors as far as how they may go about collecting the debt. This means that they will not threaten or harass debtors and that they will generally not contact third parties in reference to the debtor.
In some cases, a fraudulent collector will attempt to collect debts that simply do not exist from honest people. These people will pay these fake debts, which are usually for a relatively small amount, just to get it over with. A legitimate agency will always be willing to say who the creditor is, so avoid letters or phone calls from those who refuse to divulge that information.
It is not only important to be apprehensive about agencies that will not provide information on the creditor, but ask for personal information such as a social security number. A legal agency should already have been provided with all of the necessary information to handle your debt. Someone who calls asking for your social security number may be involved with identity theft.
In the event of collection fraud, both creditors and debtors should take the appropriate steps to protect themselves. They could begin by contacting the state Attorney General’s office to determine their rights. Once they are sure of a scam or inappropriate behavior, the next step would be to file a formal complaint with The Federal Trade Commission.
Having to pay or collect past due debts is an unpleasant experience for everyone involved, so there is no need to add to the stress by working with a fraudulent collection agency. Creditors need to be aware of the proper practices of a legitimate collector, and debtors should be familiar with their rights. Working with a genuine agency will get everyone’s finances back on track quickly and painlessly.
