WATCH: Federal Trade Commission Sues Two Companies Involved in Phantom Debt Scheme
By Federal Trade Commission // July 1, 2018
complex scam made up of- debt, debt sellers, brokers, buyers, and collectors
ABOVE VIDEO: Phantom Debt collectors scam Americans and demand payment of phony debts, as they earn millions.
(FEDERAL TRADE COMMISSION) – Have you ever gotten a call about a debt that isn’t yours?
That’s known as a phantom debt, and earlier this week, the FTC and the New York Attorney General’s Office announced that they are suing two players in an alleged phantom debt scam: Hylan Asset Management and Worldwide Processing Group.
It’s a complex web of made-up debt, debt sellers, brokers, buyers, and collectors – involving some players the FTC has sued before.
How did this scheme work?
According to the FTC, Hylan Asset Management placed portfolios of fake debt with other debt collectors and sold them to other brokers and collectors.
The FTC says that Hylan knew the debts were phantom – in fact, many were bought from people the FTC has sued for unlawful debt collection practices.
ABOVE VIDEO: What Is a Phantom Debt?
Then, Worldwide Processing Group, a debt collection company, not only collected on these illegitimate debts, but also collected on them using illegal tactics: contacting family members, employers, and coworkers (or threatening to), and failing to give people the required notices about the debt.
And, according to the FTC and the NY Attorney General’s office, the company knew about complaints from consumers that they didn’t owe the debts the company was trying to collect.
You have legal rights when it comes to debt collection – if a debt collector threatens, harasses or intimidates you, that’s illegal. Also, debt collectors have to send you a validation notice in writing, within five days of contacting you, that tells you how much money you owe, the name of the creditor, and what to do if you don’t think you owe the money.
If you do not get that notice, or if you’re harassed, tell the FTC. And if you’re getting calls about debts that you think might not be yours, learn more about phantom debt collection.
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