Creditor Threatening Arrest for Delinquent Bills - Is this legal?

Illegal Credit Collection Crackdown has creditors running!

A recent string of arrests has many consumers cheering on the government. The founder of a debt collection agency, as well as a number of its employees were arrested and are now facing federal charges for their illegal credit collection practices. Plainly put,these creditors were trying to collect a debt by calling individuals or in other ways contacting them and asserting that they, the consumer, are facing wire fraud, or other similar charges, and that if they did not pay an arrest warrant would be issued for them. These individuals allegedly were identifying themselves as "investigators" or "detectives" and were intimidating people into making payments on these accounts. The federal government has charged them with conspiracy to commit wire fraud, but the big news may come when these individuals face civil liability.

Many people think acts like these are illegal, they just don't know where or when.

When people are faced with an arrest warrant, they often trust whomever is on the other side saying there is one. This is typical, and a practice that preys on an individuals fear of being arrested. Fortunately, both the Federal government and Florida legislature have made illegal in a collection context. Florida has made this type of collection activity illegal in the Florida Consumer Collection Practices Act - See Fla. Stat. 559.72. This act makes a number of things illegal, and can open the debt collector or collection agency up to civil liability, including the following:

(10) Use a communication that simulates in any manner legal or judicial process or that gives the appearance of being authorized, issued, or approved by a government, governmental agency, or attorney at law, when it is not.

(11) Communicate with a debtor under the guise of an attorney by using the stationery of an attorney or forms or instruments that only attorneys are authorized to prepare.

Oftentimes these credit collectors are doing exactly that - stating that they are sending a legal document that looks like a state issued it, or saying they are an attorney or with a law firm when they are, in reality, not. These violations allow for civil liability if the act has been violated.

The federal government has done this as well, codifying its law into the Fair Debt Collection Practices Act - See 15 USC 1692, et seq. The Fair Debt Collection Practices Act can hold a debt collector or credit collection agency civilly liable for a number of things, including:

(4) The representation or implication that nonpayment of any debt will result in the arrest or imprisonment of any person or the seizure, garnishment, attachment, or sale of any property or wages of any person unless such action is lawful and the debt collector or creditor intends to take such action.

If creditors are using illegal collection practices, you have options.

If a creditor is trying to collect debts from you by saying you will be arrested, or that they are an attorney but don't appear in any bar registry, or worse, a meeting with an attorney may give you the information that you need to determine if the credit collector's claims are genuine or if you are the victim of an illegal practice.