Get Wise to Collection Agents' Dirty Tricks

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Someone must have slandered me.

One morning, without having done anything truly wrong, I received a phone call from a company named Allied Interstate. This was the beginning of a lengthy, agonizing process, where I nearly became a victim of what I'll generously describe as one of the most widespread and effective telephone swindles in America.

Allied Interstate is what's known as a collection agency. These companies claim to perform a valuable service for our credit-based economy by tracking down delinquent loans and persuading deadbeat debtors to pay up. On paper, the Fair Debt Collection Practices Act prohibits collectors from making fraudulent statements or threatening and harassing their prey, the people who owe these unpaid debts. In reality, most collection agencies are thugs armed with call centers.

The worst part is that they can and do come after anybody. This isn't legal and the companies will deny it, but if you look at the volume of successful class-action lawsuits against Allied Interstate and other collectors, you can see that it happens all the time. Even if you have immaculate credit and don't owe anyone a dime, you could still be targeted.

The experience is not pleasant. For the last three months, ever since the first call, I've been getting anywhere from three to nine phone calls a day from this company, all with prerecorded messages.

The law says they can only call you three times a day, but the way these collection agencies are set up, individual collectors (the official job title is agent) have huge incentives to break it. One of the agents I spoke to made a veiled threat to take me to court, and another said that he could damage my credit score if I didn't repay my debt (this debt was either someone else's or nonexistent, but we'll get to that in a minute).

There are easily hundreds of online testimonials about Allied Interstate alone, and you can also read about their practices in their class-action lawsuit settlements in Minnesota and Illinois. My experience with these guys was a walk in the park compared with what many of the people who actually owed Allied Interstate money had to go through: Collection agents have threatened to seize debtors' assets, garnish their wages and get them fired from their jobs and have even threatened them with physical violence.

All this stuff is illegal. Collection agencies prohibit their employees from making such threats, and agents can be fired if you report them. You can file a complaint with the collection agency by calling a complaint line, but good luck finding it.

It took me an hour of Googling to discover that Allied Interstate belongs to a company called Intellirisk (and has changed its name to iQor, but the iQor Web site does not anywhere indicate it owns Allied Interstate), which posts a Consumer Advocacy Help number, 1-800-811-4214, on its Web site.

That confused the hell out of me. Was I a consumer? I think common sense dictates that the companies for whom Allied Interstate collects would be its consumers. As it turns out, when they buy your debt, you become a consumer. If you've been harassed, call that line, but don't expect it to do any good.

Even if a collection agency fires the agent who harassed you, its business model practically requires its agents to make these fraudulent threats. Here's how it works: A collection agency buys up old, delinquent debt for as little as pennies on the dollar, then it gives its agents the information they need to call and send letters to collect. These agents are paid on commission.

The iQor Web site (parent company of Allied Interstate) offers job hunters "unlimited earnings potential," telling these prospective collectors, "We have an aggressive and generous bonus program that rewards performance -- the better you perform, the more money you can earn." If you're looking for work and lack moral character, visit the Web site, then click "people" on the left-hand menu, then "Working at iQor."

But not everyone is qualified to be a collection agent. A high school diploma or equivalent is required, previous telephone experience is preferred and the ability to perform simple mathematical calculations is desired.

Since most people have no idea what their rights are when a collection agent starts making threats and demanding payment, the odds of anyone reporting an overzealous agent are pretty low. If you actually do have an outstanding debt, and someone starts making these outrageous threats, you'll probably pay up.

The agent who came after me only wanted $87.34, and many of the debts they go after are for under $100. Even if you actually do owe money to a collection agency, there are a lot of circumstances where all they can do is write you letters and make harassing phone calls. It's tempting to pay the collectors off just to get them to stop, especially if they're hitting you up for chump change, but I hate the thought of giving them the satisfaction.

Also, if your debt is seven years old, you don't have to pay. I'll explain why in my next column. They can send you letters and call, but if you can tolerate that, why pay when you don't have to? If you do legitimately owe money to these hustlers, my next column will tell you how to handle them. Here's a preview: They don't play by the rules, so why should you?

There's a right way and a wrong way to handle these shysters. Because I knew nothing about this business when Allied Interstate started calling me, I went with the wrong way. Collection agencies profit from the fear and ignorance of their marks. I'm going to tell you what happened to me so that you'll know what to do if a collector decides to come after you.

The first time Allied Interstate called, I answered the phone, heard a cryptic prerecorded message telling me to call a different number immediately in order to discuss a debt and hung up. That was three months ago, and every day since (with the exception of Sundays) Allied Interstate has called me anywhere from three to nine times, with the same recorded message. After the first two months of these infuriating phone calls, I gave in and dialed the number the recorded message kept pushing on me.

That was my first mistake.

A zealous-sounding man answered for Allied Interstate and told me his name was Brian. Apparently Brian knows me better than I know myself because before I could finish saying, "hello," he revealed that my name was Chris Mason, correcting a lifetime of misspelling and mispronunciation on my part. I was thrilled. I'd never have to listen to those inevitable, agonizing "Clifford, The Big Red Dog" jokes whenever I met someone new, or spell out my first name every time I placed a take-out order (you'd think it wouldn't be that hard to communicate such a WASP-y and monosyllabic name).

Then Brian said I was lucky to have called when I did because I only had a week left to send Allied Interstate a check for $87.34 to cover a delinquent credit card bill from 2001, when I was 16 and not permitted to touch my parents' credit cards, let alone have my own.

At that point a wiser man would have said, "My name is not Chris Mason, you have the wrong guy." Unfortunately, I'm merely a wise-ass, and I wasn't at the top of my game, so I asked, "Wait, a week left to pay or what?"

My pal Brian said something along the lines of, "That's the deadline. If you don't cooperate I can transfer your case to legal, and nobody wants this to go to court."

I hadn't done any research on collection agencies yet, but I was pretty sure this guy was being less than honest. So I decided to end the conversation. I told him he had the wrong guy. I said I was not Chris Mason, sadly, and then I made my second mistake: I gave him my real name. Brian tried to ask for my Social Security number after that, and I stopped being patient. I told him to remove my phone number from the Allied Interstate list, because I was the wrong man, and hung up.

After that call, I did some research about these collection agencies. I learned that it is illegal for them to continue calling you after you have identified yourself as someone unrelated to the person who owes the debt that they're after. I also learned that collection agencies couldn't care less about the law, or at least that's how it seems if you look over the lawsuits and complaints and consumer advocacy groups that have popped up in response to their bad behavior.

So I wasn't incredibly surprised when Allied Interstate called me the very next day with the exact same prerecorded message. They kept hitting me with multiple calls for about a month before I called them back again. I waited so long because it turns out that getting a collector off your back is a long and difficult process.

You can send a certified letter telling the collector that they've got the wrong man, but this doesn't always work, and I hadn't asked for the collector's address. (This is extremely important -- you cannot just send the letter to the company's headquarters or any of their call centers, it has to be to the call center that has been calling you. I'll explain why in a minute.)

You can contact your state Attorney General's office to file a formal complaint (I might have done this before Eliot Spitzer, our AG in New York State, moved on to bigger and better things), but before doing so you have to send a certified letter to the collection agency. Failing these two options, you can get a lawyer, which costs more than the $87.34 Allied Interstate wanted from me.

Instead of going through all that red tape, I decided to give it one more shot and called Allied Interstate back. This time I knew my rights, and in my naiveté thought that could help. Let's call this the first thing I did right.

I tried calling Allied Interstate from work Monday, but they told me to call back from the phone they had been calling. Rather than doing that, I found a number for what looked like Allied Interstate's call center hub, and a woman named Jenice answered. I told her that I had forgotten my home phone number, but asked if she could look up my name on her database.

Her response was pretty interesting: She said that there were no Cliff Masons in her database, but she could only access names from her own call center, not any of the others. She said if I wanted to stop the calls, I would have to deal with the call center that had been calling me.

Jenice didn't know which center that was, and she recommended I call from my home phone number, the one Allied Interstate had been calling every day, in order to speak with someone who could help.

(Yesterday I did just that. I was connected to Steven, who apologized on behalf of the company for getting my name wrong after I told him about my first conversation with one of Allied Interstate's agents. I asked Steven for his last name, but he demurred. Then I asked him why the calls had continued, and he told me that they had looked up my name and discovered I had an unpaid AOL bill from 1997, when I was 12. I told him that was impossible. He told me he could put it on my credit report and damage my credit score (a nearly immaculate 774, not that I haven't been doing my best to push it lower).

I demanded that Allied Interstate send me a written notice explaining how to dispute the debt, which they are required by law to do, meaning the odds of him actually doing it were 50/50.

Steven agreed, and then he asked me if my mailing address was still in Oregon. Since I've only been to the West Coast once -- a trip to L.A. that didn't agree with my pasty skin -- I let Steven know that I'd never been to Oregon, and he transferred me to his supervisor.

I couldn't pronounce the supervisor's name, let alone spell it, but she was very polite and after telling her my age and explaining that I was calling from a New York City area code, she looked up their data on Cliff Mason -- there were three of us living on the West Coast, two in California, one in Oregon, and then she asked for my mailing address, which I would not provide. She stayed polite, and agreed that I must be a different Cliff Mason. She said the calls would stop.

That was yesterday. I'm not optimistic.

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