Yesterday, the Federal Trade Commission announced that debt collection industry giant West Asset Management has agreed to pay a record $2.8 million for alleged violations of the FTC Act and the Fair Debt Collection Practices Act. According to a press release issued by the FTC, West Asset Management employs 1,500 debt collectors in 13 states and one offshore location.
The FTC complaint outlined a number of egregious offenses, including calling consumers several times each day, calling consumers who weren’t the delinquent account holders, using abusive language, illegally disclosing information about the debts to third parties, and ignoring consumers’ cease and desist letters.
But the violations don’t stop there. The FTC alleges that West Asset Management took money out of consumers’ bank accounts or charged credit cards without permission, and issued a number of threats to consumers, including falsely claiming that they would be sued or arrested, or have their property seized. Furthermore, the FTC alleged that the debt collection agency told consumers that partial payments would be accepted as full settlements, even though that wasn’t true.
The $2.8 million is the largest civil penalty ever levied by the FTC in a debt collection case. As is typical in settlement cases, part of the agreement is that West Asset Management doesn’t have to admit to violating the law. Still, seeing bad players brought to justice through a monetary penalty is rewarding.
