Beware Phony Debt Collectors

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Debt collection is a sketchy business, but in some cases it can go from sketchy to illegal.

Authorities in Texas are going after a local payday lending firm, Federal Cash Advance, for posing as a government office in order to collect its debts. The agency purportedly sent a fake mailing to consumers claiming to be from the Dallas County Clerk’s office.

The state of Texas charges that the owner, Patrick D. “Dylan” White, illegally misrepresented himself and his company as an “official Dallas County government agency”. Here’s a copy of the grammatically challenged letter sent to delinquent debtors:

We are contacting you inform you that your information from Federal Cash Advance has been forwarded to the Texas Districts Attorneys office and will be reviewed and upon the details of your case you will be contacted with any information of any upcoming court date(s).”

Please be aware that the penalties in your case include up to 5 years in State Prison, a fine of up to 10,000, restitution for the check, court cost, and statutory fees.

Thank you


Officially, the state attorney general’s office charges White with sending “deceptive letters” to state residents with outstanding debt. While the letter was poorly written, the envelopes bore the official seals of the State of Texas and Dallas County.

Attached was a “notice of debt collection” that instructed individuals to call a phone number that led to Federal Cash Advance. The letter also included a bogus "case number” and a threat of jail time for noncompliance.

Texas Attorney General Greg Abbot didn’t take too kindly to that action and has issued a court order to get him to stop. But that’s the least of White’s problems now.

Texas’s Finance Code “prohibits debt collectors from “threatening debtors with prison sentences”, and it also “bans deceptive collection notices that improperly pressure debtors to pay their debts.”

Consequently, state officials are going after White where it really hurts – his wallet. According to a statement from the attorney general’s office, Texas is seeking fines of $20,000 “per violation”, under the state’s Deceptive Trade Practices Act and the Finance Code.

Abbot’s office isn’t saying how many letters Federal Cash Advance sent out. But at $20,000 a pop, those fines could really add up – and might one result in White getting a debt collection notice of his own.

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