Earlier this year, after launching an investigation into the Texas-based collection agency Goldman Schwartz, Inc., the Federal Trade Commission (“FTC”) makes the decision to file suit against the collector for violations of the Fair Debt Collection Practices Act (“FDCPA”). The Texas U.S. District Court ordered the agency to close its doors after allegations of harassment, lies and threats were made against consumers to collect debts owed for payday loans. The collection agency collected debts for Ace Cash Express, Advance America, Allied Cash Advance, Checkmate, First Cash Advance and MoneyMart. The court also froze all of Goldman Schwartz’s assets and banned them from engaging in any collection activity
while the FTC moves forward with its case.
The FTC alleges that collectors working on behalf of the agency, falsely threatened arrest and imprisonment and even went so far as to tell consumers that failure to make payment would result in their children being taken into government custody. A report to the FTC stated the agency went so far as to tell a Virginia woman that she would be arrested, sentenced to jail for three years and would lose her disability payments for failure to make payment on a $980 debt. In addition to threatening its debtors,
collectors disclosed information regarding debts to consumers’ family members and fellow military officers. The agency allegedly represented itself to consumers as a law firm capable of filing suit or inferred it was affiliated with the local sheriff’s office and collected late fees and attorneys’ fees it was not entitled to receive.
The complaint specifically charged Goldman Schwartz with violations of the FDCPA including:
- claiming that consumers committed crimes by not paying their debts resulting in arrest or imprisonment;
- claiming to work in conjunction with law enforcement agencies;
- claiming Goldman Schwartz is a law firm and not disclosing it is actually a collection agency;
- using harassing, obscene or profane language, placing repeated and continuous calls to consumers with the intent to harass
- calling at hours before 8:00 a.m. and after 9:00 p.m.;
- adding unauthorized late fees and attorney’s fees to the amount consumers allegedly owed; and
- not disclosing a consumers’ right to dispute a debt and to request validation.
If you believe you have been the victim of an abusive debt collector or have any questions regarding debt collection contact SmithMarco P.C. for a free case review.