Deceiving consumers is a trademark for some debt collection agencies. Shady collectors have been known to lie about debts, misrepresent themselves as officers of the law, threaten lawsuits, and in the case of a Houston company, charged by the Federal Trade Commission, bully people into paying unnecessary fees.
The FTC announced Thursday that Houston-based RTB Enterprises, Inc., which operates as Allied Data Corporation, and its president have agreed to stop using allegedly deceptive tactics of bullying English and Spanish-speaking consumers into paying debts and unnecessary fees.
According the a federal order, the company allegedly used false and deceptive methods to collect more than $1.3 million in “convenience fees” and “transaction fees” from consumers who authorized payments by telephone.
The company allegedly trained collectors to deceive consumers into believing that payments were not accepted by U.S. mail and that fees were unavoidable. The FTC charges that in some instances fees were added to consumers’ accounts without their knowledge or consent.
Additionally, the FTC found that the company’s collectors allegedly deceived both English and Spanish-speaking consumers by falsely claiming to speak for attorneys and threatening to sue consumers who did not pay.
The court order imposes a $4 million penalty, which will be partially suspended based on inability to pay once the company president surrenders $100,000 in assets, including a luxury motor home.
The company, and its operators, are prohibited from repeating any of the alleged deceptive practices detailed by the FTC complaint.
FTC Continues Crack Down on Deceptive Debt Collection; Houston-based Defendants Agree to Stop Deceptive Fees and Practices [Federal Trade Commission]
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