May 26, 2014
Debt Collectors to Pay More than $4 million in FTC Settlement
A Southern California debt collection operation and its managers will surrender more than $4 million for consumer redress to settle Federal Trade Commission charges that it extorted payments from consumers using false threats. The settlement also carries a lifetime collection ban.
The FTC said that Asset Capital and Management Group and its ownership and management team have been hit with a total of $90.5 million in judgments to resolve the long-running case. But the judgments will be suspended once four principals surrender their assets and the company’s assets are liquidated, which will result in more than $4 million to be used to refund consumers.
Last summer, a U.S. district court halted the operation. The court order stopped the illegal conduct, froze the operation’s assets, and appointed a temporary receiver to take over the defendants’ business while the FTC moved forward with the case.
The FTC alleged the defendants used a sprawling network of intertwined companies and dozens of fictitious names to illegally extract payments from consumers for credit card debt that they had purchased from creditors. According to the FTC, the defendants employed an assortment of deceptive and abusive tactics in collecting on the credit card debt, violating both the FTC Act and the Fair Debt Collection Practices Act (FDCPA).
The FTC charged that the defendants posed as process servers in calls to consumers and third parties, falsely threatened consumers with lawsuits, wage garnishment, seizure of their property, and arrest, and disclosed debts to consumers’ employers, colleagues, and family members. The FTC also alleged that the defendants violated the FDCPA by failing to tell consumers they were attempting to collect a debt, and failing to notify consumers of their right to dispute and obtain verification of their debt.
“Consumers shouldn’t be subjected to threats and intimidation,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “We’re pleased that victims of this scheme will be getting money back from the defendants.”
Besides the monetary judgments imposed on the defendants, and the bans on collecting debt, the settlement orders prohibit them from misrepresenting any relevant fact in connection with promoting or selling credit repair, debt relief, mortgage assistance relief, or lending services.
The above statements do not represent those of Weston Legal or Michael Weston and they have not been reviewed for accuracy. The statements have been published by a third party and are being linked to by our website only because they contain information relating to debt. Nothing in this article should be construed as legal advice given by Weston Legal or Michael Weston. To view the source of the article, please following the link to the website that published the article. Articles written by Michael W. Weston can be viewed here: To report any problem with this article please email email@example.com