Mistaken Identity Largest Source of Debt Collection Complaints, Says New Report
A new report issued by the U.S. PIRG says that the most common problem consumers have with debt collectors is cases of mistaken identity, or being collected from when the debt is not yours. Debt collectors, the report says, are frequently trying to collect debts from the wrong person.
Debt-collection complaints to the Consumer Financial Protection Bureau (CFPB) are the source of the report.
“The debt is not mine,” complain the largest number of consumers. This could also be the result of identity theft.
A large number of consumers are also complaining about the following issues:
- Harassing phone calls
- Not being given the opportunity to dispute the debt
- Being sued without notification
- Being threatened with arrest
- Talking to third parties about the debt
Massachusetts has 2-3 reported complaints per 100,000 people, although this is only the people who have taken the time to fill out a complaint with the CFPB. The real number is probably much larger.
Debt collection, the report says, is the second largest source of complaints to the CFPB, outpacing all other consumer financial issues except problems with mortgage servicers.
The most complaints are against Encore Capital, also known as Midland Funding or Midland Credit Management. Other alleged offenders include some of the other big names in debt collection, such as Expert Global Solutions, Portfolio Recovery Associates, Citibank, Allied Interstate, Resurgent Capital, Capital One,
To combat this problem, the report makes the common-sense suggestion that debt collectors be required to verify the identities of people before filing debt collection lawsuits against them.
This problem is something that we have seen at Culik Law in our own practice. We regularly encounter consumers sued on debts that they have never heard of, or debts that are owed by other people.
If a debt collector files a collection lawsuit against you, or otherwise tries to collect a debt you do not owe, you may have rights under the Fair Debt Collection Practices Act or Massachusetts Chapter 93A, which prohibit unfair, misleading, and abusive debt-collection practices. These statutes require debt collectors to pay attorney fees and damages if your case is successful.
The report is available for free here: U.S. PIRG, Debt Collectors, Debt Complaints
If you feel your rights have been violated under the Fair Debt Collection Practices Act, contact us for a free consultation. You may also benefit from attending one of our free events on debtors rights.
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Culik Law is a Massachusetts Attorney / Law Firm. The posts on Culik Law’s blog are not intended as legal advice. If you have questions about your particular situation, CONTACT CULIK LAW for a Free Consultation.