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Miami debtors, have you been taken in by a debt collection scam? Recently, in the neighboring state of Georgia, a 48-year-old man who founded the debt collection agency Williams, Scott & Associates was arrested, along with six employees, by federal agents for running a scam targeting debtors.

The multi-agency bust involved the U.S. Attorney’s Office, the Federal Bureau of Investigation, the Consumer Financial Protection Bureau and the Federal Trade Commission. It is likely the first coordinated action by federal agencies against debt collectors and possibly indicates more crackdowns may be on the horizon.

The U.S. attorney in Manhattan said, “We are far from finished looking at the seedy side of debt collection. It affects too many people.”

According to prosecutors, debt collectors had scripts they used to threaten, trick and bully their victims into making payments. Some of the ruses they used would be to call themselves “investigators” or “detectives” with local law enforcement agencies. Once they had debtors on the telephone, they would accuse them of committing crimes like “check fraud,” saying an arrest was imminent unless they paid up.

Some lines read, “We are a government task force . . . to investigate . . . individuals involved in Depository Account Fraud and theft by deception.”

They claimed they were working in conjunction with the Marshals Service and Justice Department and used pseudo-legal terms that sounded legit but were meaningless as coercion for their customers to pay their debts.

The 2008 financial crisis was the impetus for many of these collection agencies to use far more aggressive tactics than ever before.

However, federal laws protect consumers from harassment and threats by debt collectors pressuring them to pay. Two years ago, the Consumer Financial Protection Bureau was handed the authority for overseeing and regulating the biggest debt collection agencies in the country.

Now, auditors from the CFPB can gain access to their agency and monitor and evaluate the collectors to insure that they are being truthful and accurate in their claims and disclosures.

If you are being hassled by debt collectors, one solution is filing for bankruptcy. A Florida bankruptcy attorney can advise you on how to proceed.

Source: CNN, “Federal agents arrest debt collectors in crackdown” Ben Rooney, Nov. 18, 2014