ACA International, the association of credit and collection professionals, is raising concerns over a regulatory enforcement program launched last week by the Federal Trade Commission that officials contend could paint legitimate debt collectors and fraudsters with one broad stroke.
The Federal Trade Commission announced the beginning of Operation Collection Protection — a new coordinated federal-state enforcement initiative targeting deceptive and abusive debt collection practices. As part of Operation Collection Protection, the FTC released information on 30 federal, state and local law enforcement actions taken against debt collection agencies.
The FTC also announced five new enforcement actions against collectors allegedly engaged in illegal practices.
The FTC is partnering with law enforcement, the U.S. Department of Justice, the Consumer Financial Protection Bureau, Attorneys General from 47 states and the District of Columbia, and local law enforcement authorities for this program.
“Being in debt is stressful enough for many Americans without also being subjected to intimidation and false threats,” FTC chairwoman Edith Ramirez said. “Debtors have certain rights and rogue collectors that step outside the law will face the consequences of illegal behavior.”
The FTC added its nationwide crackdown encompasses 30 new law enforcement actions by federal, state, and local law enforcement authorities against collectors who use illegal tactics such as harassing phone calls and false threats of litigation, arrest, and wage garnishment. The cases announced last week bring to 115 the total number of actions taken so far this year by the more than 70 law enforcement partners in the Operation Collection Protection initiative.
Illinois Attorney General Lisa Madigan said, “My office receives thousands of calls and complaints each year from consumers who are victims of illegal debt collection tactics. Through our partnership with the FTC and states across the country, we are putting scam operations out of business and protecting consumers from abusive practices by legitimate creditors.”
Minnesota Commerce Commissioner Mike Rothman added, “Illegal and abusive tactics by debt collectors are a nationwide problem that requires a nationwide response. By working together in this new federal-state collaboration, we are joining our forces to stop these abusive practices and protect the public.”
ACA International unequivocally condemns fraudulent, abusive, and unethical debt collection practices. ACA welcomes the opportunity to work with the FTC and other government agencies to stop criminals and bad actors.
However, association officials stressed the FTC’s new effort does not clearly define or acknowledge the difference between illegal operations and scammers and those legitimate debt collectors who make a sincere effort to comply with numerous and complex regulations and yet make compliance errors.
“There is a genuine difference between an honest, legitimate business struggling to comply with very complex and often unclear laws and those who flout the law and have absolutely no intent to comply,” ACA International chief executive officer Pat Morris said. “The fact is that the vast majority of debt collectors in the industry treat consumers with respect and within the law.”
Morris went on to mention ACA International has long led the effort to stop criminal debt collection activity and has worked consistently with the FTC and other regulators to help them understand the complex issues that legitimate debt collectors face.