FTC
Asks Court to Halt Illegal
"Debt Collection" Practices
A Company Uses Threats, Lies, and Intimidation
to Collect “Debts” Consumers Do Not Owe, FTC Says
In the face of more than 2,000 consumer complaints, the FTC has asked
a U.S. District court to order a halt to the harassing, intimidating,
deceptive, and illegal ‘debt collection’ practices of
Capital Acquisitions & Management (CAMCO).
At the agency’s request, the court has frozen the assets of
the company and its principals and appointed a receiver to oversee
the corporate records and assets, pending trial. The FTC will seek
a permanent halt to the illegal threats and lies the defendants use
to attempt to collect “time-barred” debts – debts
so old that they are beyond the statute of limitations, and cannot
appear on credit reports – and debts consumers never incurred
and did not owe.
In March 2004, the FTC charged that CAMCO, RM Financial, and their
principals were threatening and harassing thousands of consumers to
get them to pay old, unenforceable debts or debts they did not owe.
The agency alleged that their abusive and deceptive collection practices
violated federal law, including the Fair Debt Collection Practices
Act. The companies and individuals paid a $300,000 civil penalty to
settle the FTC charges, and were barred from engaging in abusive,
deceptive, and illegal collection practices in the future.
In the eight months since that settlement, the FTC has received more
than 2,000 consumer complaints about CAMCO’s illegal tactics
– three times more than the agency received in the two years
before the settlement.
In papers filed with the court, the agency charged that as much as
80 percent of the money CAMCO collects comes from consumers who never
owed the original debt in the first place. Many consumers pay the
money to get CAMCO to stop threatening and harassing them, their families,
their friends, and their co-workers.
According to the FTC, CAMCO buys old debt lists that frequently contain
no documentation about the original debt and in many cases no Social
Security Number for the original debtor. CAMCO makes efforts to find
people with the same name in the same geographic area and tries to
collect the debt from them – whether or not they are the actual
debtor. In papers filed with the court, the FTC alleges that CAMCO
agents told consumers – even consumers who never owed the money
– that they were legally obligated to pay. They told consumers
that if they did not pay, CAMCO could have them arrested and jailed,
seize their property, garnish their wages, and ruin their credit.
All of those threats were false, according to the FTC.
According to the FTC, grossly abusive behavior, including shouting
and profanity, are commonplace tactics with CAMCO. Collectors told
consumers:We’re “going to hound you ‘til the day
you die;” We will “continue
to hunt you;” and
“We’ll get you one way or another.”
CAMCO collectors also ignored restrictions on who
and when they could call.The FTC suit asks the court to order a
permanent bar on the operation’s illegal activities and order
redress for consumers.In addition to CAMCO, the complaint names
RM Financial Services, Inc., Capital Properties Holdings, Inc.,
Caribbean Asset Management, Ltd., Reese Waugh, Jerome Kuebler, Eric
Woldoff, George Othon, and Jeffrey Garrington.CAMCO’s offices
are located in Rockford and Schaumberg, Illinois. RM Financial is
based in Marietta, Georgia. Caribbean Asset Management is based
in Montego Bay, Jamaica.
The Commission vote to authorize staff to file the complaint was
5-0. The complaint was filed in the U.S. District Court for the
Northern District of Illinois Eastern Division, in Chicago, Illinois.NOTE:
The Commission files a complaint when it has “reason to believe”
that the law has been or is being violated, and it appears to the
Commission that a proceeding is in the public interest. The complaint
is not a finding or ruling that the defendant has actually violated
the law. The case will be decided by the court.Copies of the complaint
and legal documents related to an earlier settlement with CAMCO
and individual defendants are available from the FTC’s Web
site at http://www.ftc.gov and also from the FTC’s Consumer
Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington,
D.C. 20580.
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