The Fair Debt Collection Practices Act exists to protect consumers from unfair, deceptive and abusive debt collection actions. The Federal Trade Commission has filed a lawsuit against a Florida operation that it alleges violated the act with illegal and abusive debt collection practices.

The FTC’s complaint claims that the operation used misleading and threatening letters and telephone calls. They collected debts for beauty schools, truck driving schools, bail bondsman, fitness centers and other small businesses. According to the complaint, consumers were falsely threatened that lawsuits were being filed against them, that their property would be seized and wages garnished and even threatened that consumers would be arrested. The debt collectors often erupted into shouting and profanity during telephone calls to consumers.

The defendants operated from Florida using a series of names and mail drops in other states as well as Florida. They are charged with violating Section 5 of the FTC Act and the Fair Debt Collection Practices Act, which bars deceptive, unfair and abusive debt collection practices.

The defendants are Rawlins & Rivera Inc. of Florida, Rawlins & Rivera Inc. of Georgia, Ryan & Reed Inc. of Florida, Ryan & Reed Inc. of Georgia, RRI Inc., their officers, Janis Brust, Joe L. Hunt, Sr., Joe L. Hunt, Jr., and Shannon Hunt, and a Florida lawyer, Robert W. Bird, whose letterhead was used for many of their collection letters.

The Mortgage Bankers Association is reporting that more homeowners are falling delinquent on their mortgage payments. According to their report, 4.7% of loan payments were more than 30 day past due and 11% of mortgages were in foreclosure.

The trend is being blamed on high-risk loans with subprime rates and adjustable rate mortgages that are being affected by rising interest rates over the past few years.

More Americans Making Late Mortgage Payments

Capital Acquisitons and Management Corp (CAMCO) and affiliated companies will pay $1 million to settle Federal Trade Commission charges that their debt collection practices violated Federal law.

The FTC charged CAMCO with threatening and harassing consumers over old and unenforceable debts as well as debts they never even incurred. According to the FTC, these deceptive and abusive collection practices violated the Fair Debt Collection Practices Act.

Do you know what your rights are under the Fair Debt Collection Practices Act? What can debt collectors do and what are they not allowed to do when they contact you regarding debts?

The Fair Debt Collection Practices Act provides rules and regulations that govern how you may be contacted, when and how often. Debt collectors may not use false or misleading statements to get you to pay a debt and they may not contact you at work if you request that they do not.

For more information on the Fair Debt Collection Practices Act, visit the FTC website’s Facts for Consumers.