In the wake of the “robo-notary” scandal that has prompted federal investigations into the foreclosure processes of several large banks, another “robo” scandal against consumer debtors has been resolved. Allied Interstate Inc., a large Minnesota debt collection agency, has agreed to pay $1.75 million to settle a case filed by the Federal Trade Commission. The FTC alleged that Allied use robo-dialers to automatically call the same people multiple times a day, and in many cases attempted to collect debts that individuals didn’t owe.
Allied Interstate Inc. has a history of consumer complaints. According to the Minneapolis Star Tribune, the FTC’s federal lawsuit alleged that Allied continued to use its robo-dialing software to call consumers even after it learned it was calling the wrong person or after the individual insisted the debt was not valid. The FTC lawsuit also alleged that debt collectors spoke to neighbors, co-workers or others about a consumer’s debts, and threatened legal action it didn’t intend to take. Both of these practices violate the Fair Debt Collections Practices Act, a federal law that protects consumers.
The settlement is the second largest civil penalty the FTC has ever obtained against a debt collection firm. A FTC spokesman stated that the lawsuit and resulting settlement sent a message to the collections industry that repeatedly calling consumers who dispute a debt is not tolerated.
If you are being harassed by collection firms and need assistance with your debts, consult with an attorney and learn how the federal laws can help you. Once you have hired an attorney the federal law forbids third parties (like collection agencies or collection attorneys) from contacting you, your neighbors, or your employer. The collector must speak with your attorney. Furthermore, once you file a bankruptcy case, you are under the protection of the federal court and any subsequent contact or collection action is punishable by contempt of court. Don’t put off getting help. Contact an experienced bankruptcy attorney today.