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Debt Collection Group Objects To FTC Complaint Report Findings

Friday, March 1, 2013
By Cecelia M. Assam

A recently released Federal Trade Commission report about the top 10 consumer complaints of 2012 “paints an inaccurate portrait of consumer complaints against the third-party debt collection industry,” an industry group said Feb. 27.

In a statement, Pat Morris, CEO of ACA International, insisted that members “take consumer complaints seriously and agree on the importance of protecting consumers against businesses that engage in deceptive, unfair or abusive practices.”

Morris alleged that the FTC report “disregards that the rate of growth in the number of complaints seems to be slowing compared to previous years and leaves out important facts on the substance of complaints against the third-party debt collection industry.”

The report in question provided a list of the most frequent types of consumer complaints in the 2012 calendar year. This annual list is compiled from consumer complaints received by the commission and law enforcement organizations through the FTC online database, the Consumer Sentinel Network (CSN). It announced that debt collection is the second highest complaint received--representing 10 percent or 199,721 complaints (25 BBLR 296, 2/28/13). 

Complaints Do Not Always Mean Violations

After analyzing FTC complaint data, the industry group found several areas of concern.

The group questioned the report's “accuracy including the fact that 20 percent of complaints go to 'unknown' agencies, there exists a large number of duplicates, and the misidentification of business names,” according to the statement.

In addition to the commission's own admission that the information is “based on unverified complaints” by consumers, the ACA pointed out that “these complaints are not investigated to determine whether a legal violation, including violations of the Fair Debt Collection Practices Act (FDCPA), actually occurred.”

Morris lamented that it is “wrong to assume that just because these contacts to the FTC are tallied that the raw data equates to actual bad behavior by third-party debt collectors.” He added that debt collectors “want to work with consumers to resolve complaints. According to the Better Business Bureau, when given a chance, debt collectors work closely with consumers to resolve 83 percent of the complaints they received--a number that is significantly higher than other industries.”

The statement lauded third-party debt collection as “essential to the national and state economies, which are built on the foundation that those who provide credit, goods, and services expect to be repaid. Recovering these assets helps businesses survive, prevents layoffs, keeps cost down and ensures that credit, goods and services are available to consumers.” It also touted as “a free resource to help ensure consumers contacted about these debts know their rights and better navigate the often confusing world of personal finance” created by the non-profit ACA International Education Foundation. No registration or sharing of a consumer's personal information is required.

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