Phony debt collectors may be lurking

Consumers who owe money or are behind on their bills may be legitimately contacted by debt collectors to pay off debts. The Better Business Bureau warns consumers, however, that phony debt collectors are lurking.


Collection agencies are consistently ranked in the top five in number of complaints received by bureaus. With more than 15,000 complaints, consumers need to be aware of the best practices for when it comes to handling debt collectors.

Debt collectors seek to reclaim funds on past-due accounts on behalf of creditors, businesses or individuals. But, sometimes the “debt collector” calling turns out to be an identity thief who is trying to get you to divulge personal or financial information, such as your Social Security, bank and credit card numbers. Oftentimes, scammers will impersonate legitimate debt collectors to illegitimately obtain financial information. These fraudulent calls can be harassing and threatening.

Consumers need to know the red flags for fraudulent debt collectors. If the collector refuses to reveal the name of their agency or demands that the payments be made in cash or money transfer only, consumers need to report this immediately.

It’s important for consumers to verify the alleged debt before taking action. The BBB recommends doing the following:

Request written proof. Get documentation to help determine if the callers are actually identity thieves or if a debt is actually owed. By law, a debt collection agency must provide a validation notice within five days of contacting you about the debt. Within 30 days of receiving their validation notice, send the debt collector a written request to further verify the debt details. Do not provide personal or financial information unless the validity of the debt and the debt collector has been confirmed.

Verify the legitimacy. Get the debt collector’s name and contact information to research the agency further. Search on the Internet to see if they have a website or a BBB Business Review at Cross-check contact information and call them using a phone number from a public or online directory. Verify that the representative who called is affiliated with the agency.

If you do not owe the alleged debt, the BBB recommends doing the following:

Don’t ignore the collector. It is best to respond immediately, even if you don’t believe the debt is yours. Otherwise, the collector may continue contacting you or file a judgment.

Don’t pay. Do not claim a debt that isn’t yours or make a payment on a bill just to make the collector “go away.” Even just one payment can indicate that you are accepting the full responsibility of the debt. The invalid debt could also reflect as a liability on your credit report.

Contest errors. If no debt is confirmed, contact any involved parties to clear up inaccuracies on your credit report, such as: the debt collector; the creditor or company claiming unresolved accounts; and the major credit bureaus. Write a detailed letter and include supporting documents to prove your case. The Federal Trade Commission provides additional resources for reporting errors on their website at

Check for identity theft. If contacted by a collection agency regarding erroneous bills or debts, it could be an indication of identity theft; an imposter may be using your identity to make purchases, open accounts and obtain credit. Review your credit report to quickly identify fraudulent activity or make corrections; visit for a free credit report and get FTC advice for resolving specific identity theft problems relating to debt collectors.

The BBB recommends doing the following for debt you do owe:

Know your responsibilities. It is not against the law for a debt collector or creditor to contact you regarding unpaid debts. Try working with them to resolve issues. Discuss doing a payment plan and request all promises and obligations in writing.

Complain about abusive practices. Report harassment, threats and other violations of federal telemarketing laws to the FTC. File a BBB complaint if you believe a debt collector is acting unethically. Also, research state laws on debt collectors, which may vary.

Stop collector calls. According to federal law, a debt collector cannot continue to contact you — at work or home — if you tell them to stop. Write a letter stating not to contact you anymore. Save a copy of the letter then send the original via certified mail and request a return receipt. If a debt is owed, the collector or creditor can still take legal action to collect funds and may contact you to inform you of their action.

Seek help for debt. Try using the BBB’s free online program Managing Credit – Made Simpler at or find a reputable credit counseling firm at

Know your rights. Review the federal Fair Debt Collection Practices Act (FDCPA), which sets standards for collection agencies and prohibits abusive tactics. The FDCPA is enforced by the FTC and violations should be reported.

Debt collectors:

• May not make false or deceptive claims.

• Are not allowed to make idle threats, express or implied, or use abusive or profane language.

• Should not discuss consumers’ accounts with unauthorized third parties.

• May not inaccurately report credit information and pressure consumers to pay debts they do not owe.

• Must investigate the validity of a dispute over a debt.

Reach Kelvin Collins, the president/CEO of the Better Business Bureau of Central Georgia and the CSRA Inc., at (800) 763-4222 or