Millions of American consumers have racked up over $2 trillion in debt. With so many owing so much, it's inevitable that some people fall behind in making payments for any number of reasons - living beyond their means, lost jobs, medical expenses, etc.
The reasons don't matter to the creditors - they want their money.
Sometimes, when a bank, credit card company, or doctor's office can't get a debtor to repay, they turn the debt over to a collection agency or debt collector. Collectors may buy the debt from the creditor for a discount, or they may take a percentage or commission on any money they collect.
Either way, state and federal laws place rules on what debt collectors can and can't do when trying to collect a debt. Legal problems are in store for collectors who don't follow the rules.
Illegal Trickery in Pennsylvania
Some collectors in Pennsylvania went to extraordinary - and illegal - lengths to recover money owed, such as:
- Using fake subpoenas to order creditors to appear in court for "hearings" about their debts
- Imitating deputy sheriffs to deliver or serve the subpoenas
- Holding"hearings" in a fake courtroom (often with a fake judge) in an office located in the collections agency's office building
- Gathering information or inventories about the debtors' assets and income
- Forcing payments from debtors who believed they'd been ordered to do so by a court
Acts Covering Debt Collectors & Servers
- Lie about being attorneys or government officers
- Send you anything that looks like an official government or court document - like a subpoena - when in fact it isn't
In many states, including Pennsylvania, subpoenas and many other court documents usually may be delivered by deputy sheriffs or any other adult. However, it's a crime to imitate law enforcement officials. Also, under Pennsylvania law, it's illegal to collect information about the debtors' assets unless special court rules are followed.
The Pennsylvania attorney general filed a lawsuit against the collection agency. The suit demands repayment or restitution of money paid by creditors, as well as penalties between $1,000 and $3,000 for each violation of the law.
As of mid-November 2010, criminal charges haven't been filed.
What You Can Do
If you have debts, there are some things you should know and some things you can do, even if debt collectors aren't calling you. For instance, know your rights under the FDCPA and state laws. For instance, collectors:
- Can't threaten to have you arrested if you don't pay, or use threats of force of violence
- Can't take or threaten to take your property unless it can be taken legally - like a car repossession
- Have to stop calling you if you demand it in writing
There are many other things to do if you're having trouble making payments:
- Talk to your creditors directly and ask about a repayment plan that fits your budget
- Contact a reputable credit counselor to help you manage and pay back your debts. Be wary of credit repair scams!
- If all else fails, talk to an attorney about filing for bankruptcy protection
- If you think you're being treated unfairly by a creditor or a collection agency, file a complaint with the US Federal Trade Commission and your state attorney general's office.
Being over your head in debt is stressful enough. Don't let that stress and bullying by debt collectors make matters worse for you and your family.
Questions for Your Attorney
- How can I tell if a subpoena is real?
- What happens if I ignore a subpoena?
- Can I sue a debt collection agency myself, or do I have to wait for the FTC or attorney general to file a lawsuit?