Jake, 21, put away every spare penny he earned working part-time as a waiter while enrolled in college. After seven months, he saved up enough money to negotiate a settlement with the collection agency that held his two-year old credit card debt. The next day, when a debt collector called, Jake was ready. He hemmed and hawed, claimed poverty and worked the debt down to roughly half of what he originally owed. Jake had never before felt the kind of relief he experienced when he mailed out the money order.
A week later, Jake receives yet another call from the collection agency demanding payment. He points out that he already sent the money order only to have the debt collector inform him that the company does not accept money orders. Soon what actually occurred becomes clear: Jake sent his payment to a con artist posing as a debt collector and still owes the full amount to the collection agency.
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| Who is that debt collector really? |
Fake Collection Agencies
It's rather ironic to call a fake collection agency a scam artist since the term applies equally well to most legitimate collection agencies. Fake bill collectors run their scam by contacting innocent consumers claiming to be representatives of a debt collection company. They'll make up a company name, an amount you supposedly owe and harass you mercilessly – just like a real collector. Paying these scam artists is doing nothing more than flushing your money...which is pretty much the same thing that happens when you pay an actual collection agency.
Collection agency scams range from basic to frighteningly advanced. While some clueless con men call consumers at random, hoping to find some equally clueless consumer willing to pay off a nonexistent debt, others extend more effort finding the right victims. Don't automatically assume that just because a debt collector knows your address, your middle or maiden name, your date of birth or even your Social Security number that the bill collector works for a legitimate company. The internet and public records database host a wealth of personal information about you that scam artists are more than willing to use when duping you into paying a fake collection account.
Signs That a Debt Collector is Really a Con Artist
To keep yourself and your bank account safe and secure, here are just a few signs to watch out for when determining whether that debt collector on the other end of the line is the real mccoy or just a skilled con man.
1. The collection agency the debt collector claims to work for has a title that makes the company sound as if its affiliated with the federal government. Con artists do this in order to further frighten consumers into paying debts that don't exist. Be on the lookout for words like, "U.S.", "Federal", "State", "Bureau" and "National." Real collection outfits typically have more commercial titles that don't necessarily betray the fact that the company collects overdue debts.
2. The amount the debt collector claims you owe is less than $500 and often less than $100. Skilled con artists know that consumers are more likely to pay off debts simply to prevent further collection calls if those debts are small.
3. The bill collector requests that you pay the debt via wire or money order. A real collection agency will almost always demand that you pay your debt by giving the company permission to directly draft your checking account. This gives the company access to your banking information so that it can easily garnish your account later on.
4. The company name doesn't pop up in a Google search. Even the smallest collection operations have someone out there complaining about them, and a Google search will turn up evidence that the company exists. A real name, however, doesn't guarantee the debt is legitimate. Some fake collection agencies use the names of real companies when running their scam.
5. The same collector calls you every time. Collection agencies often employ hundreds of collectors, and different agents will call you at different times. If the same individual continues to call you, you may just be looking at a one-man fake collection agency.
6. The collector is blatantly ignorant of the law and violates the FDCPA repeatedly during collection calls. While real debt collectors are also known to violate the FDCPA, numerous consumer lawsuits in recent years have resulted in collection agencies cracking down on illegal debt recovery techniques. Therefore if the caller swears at you, threatens you and seems to have no answers for the educated questions you ask, you may just be dealing with a fake.
What to Do If You're Contacted By a Fake Bill Collector
Your first step when you realize the person you're one the phone with is likely a con man should be to feign ignorance while getting as much information out of him or her as you can. The more accurate information you can get, the easier it will be for authorities to find the scammer and shut his fake collection operation down for good.
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| Turn the tables on scammers. |
It's a given that a con artist won't give you his real name but, if money is on the line, he may be dumb enough to give you his actual telephone number or address. The FDCPA requires that real debt recovery companies send you written documentation of the debt within five days after first making contact with you. If you suspect the collector is a fake, ask for your written statement. You'll either never hear from him again or you'll recieve a bogus statement in the mail. Check the statement for a return address or any other clues you can pass on to law enforcement officials.
And don't forget to check your credit report just in case. Even if you're 100% certain that you don't owe any outstanding debts, collection calls from out of the blue may be a sign of genuine identity theft rather than a fake collection agency.
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Fake Collection Agencies Scam Consumers
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