The Secret Ties Between Debt Collectors & DAs
What if local law enforcement is the source of debt collection threats?
Sep. 30, 2012 -- Of all the debt collection scams, the ones that inspire the greatest panic come over the phone. A menacing, often almost incomprehensible voice, claiming to represent a creditor, demands immediate payment of a supposed debt. Otherwise, the caller threatens, the consumer could be arrested and thrown in jail.
"Outrageous!" we tell the many consumers who contact us every week seeking help after being cowed and frightened by these bullies' threats. To each of them, we repeat the same advice: "Ignore their calls. Report them to local law enforcement."
But what if local law enforcement is the source of those threats?
In some 300 communities across the United States, that's exactly what's happening. From Baltimore to Los Angeles, prosecuting attorneys are renting out their letterhead -- and their law enforcement clout and credibility -- to debt collection companies, as a recent exposé in the New York Times revealed. Using the name and official seal of the prosecutor's office to give weight to their threats, these private companies -- with no legal authority whatsoever -- then send out letters to debt-challenged consumers threatening criminal prosecution and possible jail time if they don't pay up.
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