Former Debt Collection Company VP Ordered to Pay Penalty and Stop Deceptive Debt Collection Practices

Debt Collection  •  FTC  •  FTCA

FTCOn September 21, the Department of Justice (DOJ) announced that the U.S. District Court for the Eastern District of Texas entered a stipulated order for a permanent injunction and civil penalty judgment against the vice president of a debt collector.

Following an investigation of the debt collector by the Federal Trade Commission, on January 21, 2015, the United States filed a complaint against the debt collector, its president, and its former vice president, alleging that collectors called consumers claiming to be attorneys or judicial employees.  As previously reported by Enforcement Watch, that complaint alleged that collectors allegedly falsely told consumers that lawsuits had  been filed against them, offering to settle the lawsuits out of court, or claimed that consumers’ wages would be garnished.

The stipulated order prohibits the debt collector’s former vice president from participating in debt collection activities, and assessed a civil penalty of $496,000.  The former vice president was ordered to pay $10,000 to the United States, after which the remainder of the penalty will be suspended.

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