What debt collectors can and cannot do to you

I get many clients coming in who have had huge problems with debt collectors abusing them.  A debt collector is a third party entity that is not the original creditor.  It can be a company or a law firm.

One client told me of an elderly lady (his neighbor) who was hounded by a collector regarding a medical bill.  He told her he was from the sheriff’s department and that if she didn’t bring him $500 within the next 2 hours she would be taken to jail.  Needless to say, the woman was horribly upset, went to her bank and withdrew $500.  This was almost all the money she had since she had just received her monthly Social Security check.  She then took it to the office the “sheriff” told her to.  About an hour after she got home, she called the actual sheriff’s department and asked them how long her payment would keep her out of jail.  The person on the phone explained that no one from that department would ever call her and demand money and that she was at no risk of going to jail.  She was asked where she took the money and what she was told.  The good news is that a real deputy went to the collector’s office, arrested him for impersonating a police officer, and retrieved her money.

That’s an extreme example, but a lot of these sleazeballs will use other coercive and illegal tactics to shake you down.  Here’s a list of what a debt collector can and cannot do under federal law.  Some states, like Washington, have similar Consumer Protection laws that either mirror the federal laws or are even stricter.  Hopefully, this will help you know your rights so you can put a stop to it or have a lawyer sue them on your behalf.  

What practices are off limits for debt collectors?

Debt collectors may not

• harass, oppress, or abuse you or any third parties they contact;
• use threats of violence or harm;
• publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
• use obscene or profane language; 
• repeatedly use the phone to annoy someone;
• falsely claim that they are attorneys or government representatives;
• falsely claim that you have committed a crime;
• falsely represent that they operate or work for a credit reporting company;
• misrepresent the amount you owe;
• indicate that papers they send you are legal forms if they aren’t; 
• indicate that papers they send to you aren’t legal forms if they are;
• give false credit information about you to anyone, including a credit reporting company;
• send you anything that looks like an official document from a court or government agency if it isn’t; 
• use a false company name;
• try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;
• deposit a post-dated check early;
• take or threaten to take your property unless it can be done legally;
• contact you by postcard.

Debt collectors also are prohibited from saying that:

• you will be arrested if you don’t pay your debt;
• they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; 
• legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.