Continuing our multi-part discussion of “Crazy Stuff Collectors Say,” I’ll focus in this post on a technique that frequently comes up in collection calls. I call it the “fraud” tactic. The collector may something like the following:
“Look, you knew when you used this credit card that you were not going to be able to pay. You’ve committed fraud against our client. Unless you make a payment today, we’re going to recommend that our client go after you for wire fraud.”
The FDCPA prohibits debt collectors from making false statements, including the false implication that you have committed a crime in failing to repay a debt. A debt collector simply has no way to determine what your intentions were at the time you made a purchase on your credit card. Nor are they legally qualified to determine what is or what is not a criminal offense. So this is actually a clear violation of the Fair Debt Collection Practices Act, yet it’s a tactic that is used frequently by debt collectors.
How should you respond to such a threat? I normally recommend that you try to work with your creditors in order to resolve your debt problems. And I also recommend that you work through their assigned collection agencies when necessary, which usually happens after an account has passed the point of charge-off. However, this assumes that agency representatives behave in a reasonable fashion and stay within the confines of the rules for debt collection. In other words, you should work in good faith with those collectors who are doing their jobs correctly. However, if a debt collector is prepared to falsely accuse you of a crime, there is simply no reason to continue the conversation any further.
So here’s one way to handle the bogus “fraud” accusation:
COLLECTOR: “Unless you make a payment today, we’re going to recommend that our client go after you for wire fraud!”
YOU: “May I have your full name, please, as well as the name and address of your agency?”
COLLECTOR: “Why do you want that?”
YOU: “So I can make sure I spell your name correctly in my complaint to the Federal Trade Commission and my state Attorney General. You just accused me of committing a crime, which means you violated the Fair Debt Collection Practices Act. Failure to properly identify yourself and your company is another violation. What is your full name, please, as well as the name and address of your agency?”
At this point, many collectors will just hang up the phone rather than continue the game. Or they may dig themselves in deeper by getting angry or belligerent.
If you feel a collector has crossed the line then you should definitely go forward with your complaint. You can file complaints against debt collectors online at the FTC website. You should also file a complaint with the Attorney General in your state as well as in the state the collector is located. I don’t recommend you complain formally unless you have good cause, but it’s important for consumers to stand up for their rights, and one way to do that is to ensure that the proper authorities are informed when a debt collector crosses the line and becomes abusive. And by any standard, a false accusation of criminal intent is certainly an abusive tactic that should not be ignored.