FTC permanently bans debt collection from collection agencies
In tandem with federal and state regulators and attorneys general, on September 29, 2020, the FTC launched Corrupt Collector Operation to target collectors who engage in unauthorized and abusive collection practices. At the same time, the FTC announced that it had filed a complaint and obtained temporary restraining orders against National Landmark Logistics (National) and Absolute Financial Services (Absolute).
Without wasting time showing that they are serious, on March 15, 2021, the The FTC announced that, through regulation, National and Absolute were permanently banned from the debt collection industry. The FTC didn’t mince words, stating that the following actions led to these results:
National logistics and absolute financial services [used] illegal robocalls to leave messages for consumers that threatened the outcome of legal action until arrest. The messages did not identify the caller as a debt collector, and when consumers returned calls, defendants presented themselves as mediators or lawyers.
In most cases, debt settlement collected by National Landmark and Absolute Financial were not actually owed by consumers, either because they never existed in the first place or because they had been paid off before.
In addition to being permanently banned from the collections industry, in their respective settlement agreements, National accepted a monetary judgment of $ 16,418,306.00 and Absolute accepted a monetary judgment of $ 11,281,993.00. Although these judgments are partially suspended due to the inability of National and Absolute to pay, if either entity has misrepresented its financial position, the entire judgment will be due immediately. Additionally, National and Absolute have agreed to cooperate with the FTC in ongoing law enforcement actions.
The regulations also permanently banned entities affiliated with National from the collections industry: Liberty Solutions & Associates, LLC and LSA Processing Systems, LLC, as well as James Dennison and Eric Dennison. The subsidiaries of Absolute, Absolute Financial Services, LLC, Absolute Financial Services Recovery, LLC and AFSR Global Logistics, LLC, were included in Absolute Settlement LLC, along with Lashone Elam and Talesia Neely.
In addition to hurting consumers, bad actors can tarnish the reputation of the accounts receivable industry. Entities that spend enormous amounts of time, energy, and financial resources to comply with applicable laws and regulations should welcome surveillance to root out bad actors from our space. Additionally, legitimate businesses may be the first to spot scammers targeting consumers; initiatives like Corrupt Collector Operation can provide a resource for the right players to report scams going through their desks.