Debt Collectors Banned From Facebook

A federal judge in Florida recently issued an order prohibiting a debt collection company from contacting a woman through her social media accounts in an attempt to collect on debt, specifically naming Facebook, as it appeared that Mark One Financial LLC of Jacksonville, Fla., had been contacting the plaintiff’s friends and family.

Judge Baird ordered Mark One Financial to refrain from contacting the woman’s family or friends.  The order is part of a lawsuit that Melanie Beacham filed last August against the debt collection agency who were attempting to collect on a $326 auto debt.

The plaintiff’s attorney, Bill Howard said that he had been approached by almost a dozen additional potential clients because debt collectors have taken to tracking down and harassing debtors through their social media accounts.  Mr. Howard called it “…the beginning of an epidemic”.

Florida has consumer protection laws that include the prohibition of activity that would be considered harassment.  For additional information please go to The Washington Post article here.

Extortion Scam

The Oregon Department of Justice has received several complaints regarding phony debt collection calls.

http://www.cccsso.org/News.asp?NewsID=4. Scam artists pose as debt collectors or law enforcement officers calling about an outstanding debt from an online payday loan. They frequently use fake phone numbers and official sounding business names. They also do their research. Some Oregonians have been tricked into paying nonexistent debt because the scam artist knew personal information about them, including their Social Security number, home address, e-mail, and names of family and personal references.

Attorneys in various states (even consumer advocates) have also recently reported that fake collection calls have been made in their names, without their knowledge or permission. This is identity theft. If you get collection calls from anyone claiming to a be a California attorney, best to check under the “attorney Search” section with the state bar http://www.calbar.ca.gov/ and confirm not only that the attorney’s name is registered but that the phone number and address matches with the address listed on the bar web site.

Extortion Scam Related to Delinquent Payday Loans

FBI National Press Office (202) 324-3691

The Internet Crime Complaint Center has received many complaints from victims of payday loan telephone collection scams. Callers claim the victim is delinquent in a payday loan and must repay the loan to avoid legal consequences. The callers purport to be representatives of the FBI, Federal Legislative Department, various law firms, or other legitimate-sounding agencies. They claim to be collecting debts for companies such as United Cash Advance, U.S. Cash Advance, U.S. Cash Net, and other Internet check-cashing services.

According to complaints received from the public, the callers have accurate data about victims, including Social Security numbers, dates of birth, addresses, employer information, bank account numbers, and the names and telephone numbers of relatives and friends. How the fraudsters obtained the personal information varies, but in some cases victims have reported they completed online applications for other loans or credit cards before the calls started.

The fraudsters relentlessly call the victim’s home, cell phone, and place of employment. They refuse to provide any details about the alleged payday loans and become abusive when questioned. The callers have threatened victims with legal actions, arrests, and, in some cases, physical violence if they do not pay. In many cases, the callers harass victims’ relatives, friends, and employers.

Some fraudsters have instructed victims to fax a statement agreeing to pay a certain amount, on a specific date, via a pre-paid Visa card. The statement further declares the victim will never dispute the debt.
If you receive these calls, do not follow the caller’s instructions. Rather, you should:

  • Notify your banking institutions
  • Contact the three major credit bureaus and request an alert be put on your file
  • Contact your local law enforcement agencies if you feel you are in immediate danger
  • File a complaint at www.IC3.gov

Tips to avoid becoming a victim of this scam:

  • Never give your Social Security number—or personal information of any kind—over the telephone or online unless you initiate the contact
  • Be suspicious of any e-mail with urgent requests for personal financial information. The e-mail may include upsetting or exciting but false statements to get you to react immediately
  • Avoid filling out forms in e-mail messages that request personal information
  • Ensure that your browser is up-to-date and security patches have been applied
  • Check your bank, credit, and debit card statements regularly to make sure that there are no unauthorized transactions. If anything looks suspicious, contact your bank and all card issuers
  • When you contact companies, use numbers provided on the back of cards or statements

New Treasury Rule Protects Social Security, VA, Other Federal Benefits

National Consumer  Law Center Advocate Applauds New Rules

WASHINGTON, D.C. – A federal rule  issued today that strengthens protections for bank accounts used to collect  federal benefits is welcome news for retirees, veterans and disabled persons,  according to a lawyer for the National Consumer Law Center.

The  “interim final” rule, which will take effect on May 1 but is still open for  public comment, will limit creditors’ ability to freeze and take funds from  accounts that contain Social Security, Supplemental Security Income (SSI), VA  and other federal benefits. These benefits, which are legally protected from  court-issued garnishment orders, are critical to the survival of many  recipients.

“We applaud the work of the Treasury Department and the other  agencies to safeguard these essential benefits, and the leadership of Sen.  Max Baucus on this issue,” said Margot Saunders, an attorney with the Center.  “All too often, elders, veterans, and disability benefit recipients who rely  on these benefits for their basic needs have been unable to access them for  extended periods because of creditor-imposed garnishment  freezes.”

Social Security, Supplemental Security Income (SSI), VA, and  similar federal benefits are intended to meet beneficiaries’ daily needs.  Federal law makes these funds immune from seizure by creditors.

But  in practice, creditors frequently obtain court garnishment orders so that  banks then freeze bank accounts containing protected funds. A beneficiary may  be unable to access urgently needed funds for weeks or months. Often, the  paperwork and procedures needed to end an illegal freeze prove too daunting  for a recipient, so that a bank turns over supposedly
“untouchable” funds to  a creditor.

The new rule prohibits the practice of denying beneficiaries  access to these essential funds in bank accounts. It requires all banks to  determine whether an account contains protected funds. If an account contains  protected funds, the bank is required to protect two months of benefit  payments from garnishment. Protection of more than two months of benefit  payments requires additional court filings by the beneficiary.

In  announcing the rule, the agencies stated that its framework could be expanded  in future years to protect other federal payments such as  military retirement.

“There are still many other steps that need to be  taken to make bank accounts safe,” Saunders said. “But this new rule will  give peace of mind to many elders, veterans, and disability benefit  recipients.”

Comments on the new rule may be filed by May 24, 2011, by  going to www.regulations.gov and entering “3206-AM17″ in the keyword field.