Asset Acceptance Gets Slapped With a 2.5 Million Dollar Fine By The FTC
Asset Acceptance was recently fined $2.5 million dollars because of their collection practices (click here to read an article in Business Week about this topic). To the normal person, $2.5 million dollars is a tremendous amount of money but to a company that takes in over $100 million per year, this is just a small transaction cost.
Under an agreement with the Federal Trade Commission, Asset Acceptance will now stop threatening to file lawsuits against consumers who have debts that have expired under state statutes of limitations. In Georgia, if your debt is more than six years old and a creditor files a collection lawsuit against you, you can have the case thrown out of court because it is barred by the statute of limitations. Six years old means that you have not made any payments in the last six years.
Asset Acceptance must also conduct a reasonable investigation in the basis for claiming that the debtor owes them money.
In his recent blog post, bankruptcy expert Jay Fleischman explains the debt buyer business model. Jay explains how some debt buyers play fast and loose with collection laws and how you are the prey in their hunt for the money.
The debt collection industry seems to be coming under increasing scrutiny by the federal government. A few weeks ago, I wrote a blog post about how JP Morgan has mysteriously stopped filing collection lawsuits.
Will this decrease in collection lawsuits be permanent? Will Asset Acceptance start being nice to consumers because the FTC has started getting tough with them? Will these collection companies give up on the opportunity to squeeze millions of dollars out hard working consumers who are barely making it? I think not.
I believe that the increased scrutiny will simply lead to collection practices that just barely comply with the letter of the law. Even when debt collectors play by the rules, they can still be extremely aggressive and make themselves a pain in your neck.
If you have bill collectors that are calling and threatening you, Chapter 13 or Chapter 7 will stop all of the harassment. If you would like to schedule a free consultation to discuss your situation, please call me at 706-295-0030.