None of us want collectors coming after us for old debts. But it’s especially disturbing, and often confusing, when the debt they’re trying to collect on is fake. Even if you doubt it belongs to you, collection tactics can convince you otherwise or, at the very least, get you to pay up just to stop the calls. Unfortunately, that’s what consumers found themselves facing in a recent payday loan scam.
About the Scam
The FTC says the scammer put together a portfolio of consumers who owe on old payday loan debts. The problem is, the portfolio was fake. Not the names, though, or the information that went with them. On the contrary, the scam worked because the scammer used real names, social security numbers, and contact numbers.
Kansas resident Joel Tucker allegedly sold this fake portfolio to debt buyers. The debt buyers then contacted the listed consumers to collect on the old debts.
Of course, the targeted consumers knew nothing about these debts. Some refused to pay. Others paid anyway just to make the calls stop.
The operations of this alleged scammer have since been stopped thanks to a court order, but it serves as an important warning to all of us – question collectors who come after you for old debt.
How to Protect Yourself
If a collector contacts you to collect on an old debt, send them written request for debt validation. This requires them to provide you with confirmation of the debt in writing. If they provide no such validation, it could be a scam. But even if they do provide validation, it’s possible you could disagree with what’s stated. The point is, never pay a debt just because someone contacts you saying you have to.
If you suspect a scam – or you’re being harassed or threatened – you can file a complaint with the FTC, Consumer Financial Protection Bureau, or your state attorney general’s office.
If you recognize the debt, but know it to be outside the statute of limitations, send the collector a letter like this one. You should also dispute the debt if you know you have already paid it; write them a letter providing proof of such.
Finally, if the debt you’re disputing is being reported to the credit bureaus, it’s a good idea to submit a credit dispute to them, too.
Tags: Debt Validation