Asset Acceptance Pays Big for Debt Collection Methods
In what is sure to be considered a major victory for consumers everywhere, the FTC this week ordered Asset Acceptance to pay $2.5 Million in fines. Asset is one of the largest debt collectors / debt buyers in the country.
The fines handed out this week certainly send a message that debt collectors should not see themselves as above the law. The Fair Debt Collection Practices Act protects consumers from harassment, abuse and deception. A common way that debt collectors violate the FDCPA is through threatening legal action that is not intended to be taken, in hopes of collecting the debt. Another way is by placing telephone calls to the consumer at unreasonable hours or by placing calls to the workplace when told that the calls are not permitted or inconvenient to the consumer. Debt collectors often will disregard the statute because doing so is more likely to result in collection of the debt.
Michigan-based Asset Acceptance was fined over various practices, such as failing to state that the debt being collected could be beyond the statute of limitations; false credit reporting and attempting to collect a debt that was known to be invalid. Such conduct is not uncommon by many debt collectors large and small, as their business model for making money often is based upon buying debt for pennies on the dollar and collecting the full value or more from the consumer. When the debt is so old the statute of limitations has expired, the consumer who pays is under no legal obligation to do so, but that information Asset apparently did not disclose.
A consumer can be sued for an outstanding debt but if it is so old that the statute of limitations has passed, the consumer may still be sued, but has the limitations defense to assert, showing he is therefore under no longer under a legal obligation to pay. As to Asset Acceptance, the FTC did not want consumers to receive threats of suit, without mention that the debts may be beyond the statute of limitations.
The FTC also concerned itself with Asset Acceptance was not reporting correct information to consumer reports nor investigating claims to ensure the debts were valid. The settlement reached forces Asset Acceptance to disclose more information with greater accuracy.
While the FTC action is a big step in the right direction, debt collectors must be constantly monitored for conduct that violates the FDCPA and can never be left to be self regulating. Where there is more money to be made by violating the FDCPA standards that by comply with them, consumers should not expect collectors to change. A consumer is best protected by knowing his rights and by knowing who to contact if their FDPCA rights are violated. Contact an attorney at Kimmel & Silverman today at 800-NOT-FAIR or www.creditlaw.com for more information and a free case review.