Many people associate debt collectors with aggressive business practices. Creditors may make repeated calls, affect people’s stress levels by making threats, and even trick them into paying bills in some cases.
While there are numerous federal laws limiting how businesses can go about collecting on their accounts, a number of businesses bend and break those laws in their efforts to collect outstanding amounts owed by consumers.
A recent enforcement effort by a federal regulatory agency helps call attention to common abuses that occur in the debt collection space.
What happened?
The Consumer Financial Protection Bureau (CFPB) filed a request with the courts to hold Portfolio Recovery Associates responsible for inappropriate debt collection practices. The allegations against the company include pursuing debts outside of the legal window of time to so do, engaging in collection activity without having or providing documentation about the validity of the debt and the failure to properly review consumer complaints.
Portfolio Recovery Associates is one of the biggest debt-collection organizations in the country, and they could face a court order to pay as much as $24 million to consumers for the organization’s abusive and allegedly illegal debt collection practices. The company has already faced similar orders in the past, including one in 2015 for $27 million.
Informed consumers can assert their rights
People who don’t recognize that the refusal to provide information, the use of threats or coercion, the attempt to collect on an invalid debt or the violation of someone’s agreement with a company could all lead to consumer protection actions brought by those facing debt collection efforts.
Only when consumers speak up and fight back can they potentially curtail the abusive practices sometimes employed by financial organizations and the collection companies that they hire. A lender that promises to let someone keep a car if they make payments and then repossess it anyway or a collection company that threatens someone may have violated that borrower’s rights.
Recognizing when an automotive financing company may have violated consumer protection laws can help those with financed vehicles fight back against unlawful company conduct with the assistance of an experienced legal professional.