Alert
Close

Last chance – give now. Before 2014 ends, help struggling seniors. Donate

Highlights

Open

You and Your Town Contest-You could win an AARP RealPad

Contests and
Sweeps

$10,000 Winter Escapes Sweepstakes

Beat the cold and cozy up to a chance of winning $10,000! See official rules.

Driver Safety

Piggy bank on the road - AARP Driver Safety

Take the new AARP Smart Driver Course!

AARP Books

Visit the Money Section

Enjoy titles on retirement, Social Security, and becoming debt-free.

Jobs You Might Like

most popular
articles

Viewed

Ask Sid

5 Ways to Handle Pushy Debt Collectors

Know your rights if you get one of those dreaded calls

For West Asset Management, a debt collection firm with 1,500 employees in 13 states, harassment by telephone was the business model, says the Federal Trade Commission.

See also: How can I stop junk mail?

Answer the phone and you’d be subject to cursing and false threats of arrest, wage garnishment or seizure of property by self-described attorneys. Hang up and instantly, there was another call. Don’t answer and your phone kept ringing.

At Unicredit America, faking up a courtroom was the preferred tactic. According to the office of the Pennsylvania Attorney General, employees dressed as sheriff’s deputies hand-delivered dubious subpoenas ordering at least 370 frightened people to its office in Erie, Pa. — which was done up as a courtroom with other employees posing as judge and bailiffs.

Group of Running Numbers

Do you know how to handle debt collectors? — Illustration by Corbis

California-based collector Rumson, Bolling & Associates, meanwhile, used outright threats of violence, reports the FTC. Unless paid, its employees vowed to kill alleged debtors and their pets. To rape their mothers. And on at least two occasions, to desecrate the bodies of the deceased children of debtors owing on funeral bills.

What is it with debt collectors? Most of the 450,000 employees at the nation’s 4,100 agencies, in the words of their trade association president, are “salt of the earth” who play by the rules in their difficult task: trying to collect an overdue $150 billion that’s owed in this tough economy to businesses ranging from huge banks and utilities to mom-and-pop florists and veterinarians.

But others — plenty of them, judging by the more than 140,000 consumer complaints to the FTC in 2010 (27 percent of all complaints filed, the most for any single industry) — rely on lies, harassment and extortion to get money.

West Asset Management, which paid a $2.8 million settlement to the FTC, and the parent company of Rumson, Bolling & Associates declined to comment on the FTC’s charges. Michael Covatto, president of now-defunct Unicredit, could not be reached for comment.

Low risk, high rewards

What motivates rogues to violate the Fair Debt Collection Practices Act, the federal law that dictates what collectors can and can’t do?

“Because the incentives are high, and penalties so low, there’s much more money to be made with threats and shaking people down,” says journalist Fred Williams, who spent three months as a debt collector for a Buffalo, N.Y., agency before writing the book Fight Back Against Unfair Debt Collection Practices.

Next: How far will collectors push the limits? »

Topic Alerts

You can get weekly email alerts on the topics below. Just click “Follow.”

Manage Alerts

Processing

Please wait...

progress bar, please wait

related
VIDEO

Tell Us WhatYou Think

Please leave your comment below.

The Cheap Life

Jeff Yeager Cheap Life Ultimate Cheapskate AARP YouTube web series save money

Catch the latest episode of The Cheap Life starring Jeff Yeager, AARP's Ultimate Cheapskate. Watch

Discounts & Benefits

From companies that meet the high standards of service and quality set by AARP.

Life insurance: you are covered rain or shine

Exclusive annuities for members from AARP Lifetime Income Program from New York Life.

AARP Credit card from Chase

Members can get cash back rewards on purchases with the AARP® Credit Card from Chase.

Homeowners Insurance
Member Benefits

Join or renew today! AARP members receive exclusive member benefits & affect social change.

Rewards for Good

Your Points Balance:

Learn More

Earn points for completing free online activities designed to enrich your life.

Find more ways to earn points

Redeem your points to save on merchandise, travel, and more.

Find more ways to redeem points

Advance your skills. Transform your career.

Explore your learning possibilities.