Are Collection Agencies A Liability?


Aug 18, 2014

The Fair Debt Collection Practices Act was passed in 1996 in order to protect consumers from the sometimes abusive practices of collection agencies. The actions of collection agencies are strictly regulated and working with a collection agency could be a liability.

The goal of the Fair Debt Collection Practices Act is to ensure that consumers do not have to deal with abuse or harassment from collection agencies. The Act also states that collection agencies should be clearly presented as such. Collection agencies cannot charge consumers with fees other than their original debt and there are strict rules regarding taking legal actions against consumers.

Collection agencies are not a liability as long as they operate according to the guidelines set by the Fair Debt Collection Practices Act. In other words, a collection agency should not threaten, harass or lie to consumers. If this happens, the law would be on the side of the consumers.

You can avoid running into legal issues by carefully selecting the collection agency you work with. If you have unpaid debts and need help with collection, start doing some research on different collection agencies. There are reliable collection agencies that follow the rules.You can learn a lot about different collection agencies by doing some research on the Internet. Start by checking the Better Business Bureau to see complaints filed against collection agencies.

Some of these companies have many complaints filed against them and a government actions have even been taken against some collection agencies. This will help you eliminate the companies that use illegal practices.

Look for complaints published by different websites. Consumers who are harassed or abused by collection agencies will often write about their experiences on message boards or in blog posts. You should also look up the phone numbers of the collection agencies you are considering. You might come across complaints from consumers who receive incessant calls from one of these numbers but who are not able to identify the collection agency by name.

Contact different collection agencies and ask questions about their practices. A reliable company should be open about the collection methods they use. Find out how often consumers are contacted, how the collection agency presents itself and how easy it is for the consumer to work with the collection agency and set up a payment plan. If any of the techniques used come across as pushy or abusive, it is best to work with another collection agency.

Choosing a collection agency that uses illegal practices is a liability if you are aware that these methods are being used. Proving that you did not know how the collection agency you selected operates can be difficult. Besides legal issues, working with a collection agency that relies on illegal methods will not give people a positive image of your brand.

You need to take the time to learn more about different collection agencies and select a reliable company. Go over the Fair Debt Collection Practices Act to get a better idea of what collection agencies can and can’t do before you choose one.

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