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Court halts fake debt collectors

By Marcie Geffner · Bankrate.com
Friday, November 1, 2013
Posted: 2 pm ET

A U.S. district court has put a stop to a group of interrelated companies that allegedly used deceptive and threatening tactics to try to collect supposed payday loans that consumers didn't owe or didn't owe to those companies. The operation was halted at the request of the Federal Trade Commission after an investigation.

According to the FTC, the companies used automated telephone calls and voice mail messages that threatened legal action and arrest unless consumers responded within a few days. These illegal tactics generated millions of dollars in payments for nonexistent debts and nearly 3,000 complaints to an FTC online complaint database.

The court order froze the companies' assets so consumers who were victimized might have a chance to recoup some of their money.

According to the FTC, the companies operated in Atlanta and Cleveland and used such deceptive business names as Global Legal Services, Allied Litigation Group, United Judgment & Appeals, Dockets Liens & Seizures and United Judgment Center, all of which wrongly implied that the company had legal powers.

According to court documents, consumers were falsely informed that if they didn't pay the debts, their bank accounts would be closed, their wages would be garnished, they would face felony fraud charges, they would have to appear in court thousands of miles away from their home or they would be arrested at their workplace.

The complaint names the following defendants: Lisa J. Jeter, Nichole C. Anderson, Hope V. Wilson, Angela J. Triplett, DeMarra J. Massey, and their companies, Pinnacle Payment Services, Velocity Payment Solutions, Heritage Capital Services, Performance Payment Processing, Credit Source Plus in Ohio and Georgia, Reliable Resolution and Premium Express Processing in Ohio and Atlanta.

The FTC files a complaint when it has reason to believe the law has been or is being violated and a proceeding is in the public interest. The case must still be decided by the court.

Consumers should be on the lookout for fake debt collectors.

A debt collector might be a fake if he or she demands payment for a loan you don't recognize, refuses to give you a mailing address or phone number, asks you for personal financial or sensitive information or uses high-pressure tactics such as threatening to report you to a law enforcement agency or have you arrested, according to the FTC.

If a caller refuses to give you his or her name, company, street address and telephone number, don't pay the supposed debt or discuss the details of it until you receive a written validation notice that includes the amount of the debt, name of the creditor and your rights under the federal Fair Debt Collection Practices Act.

Have you been approached by someone who demanded payment for a debt you're unaware of?

Follow me on Twitter: @marciegeff.

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