Debt is an inevitable thing in life. No matter how hard you try to save money and pay cash for all your purchases, there will come a time when you need to borrow a certain amount for emergency purposes.
Loaning money is sometimes necessary. What matters is you pay off the debt within the terms or earlier. However, there may be circumstances that would prevent us from being a good debtor. You could be fired from a job or have become chronically ill, preventing you from maintaining a full-time job. When that happens, when you haven’t paid your loan, for a few months, that’s when debt collectors come in.
Debt collection agencies are commissioned by lending companies to collect the money you owe them on their behalf. These are legitimate businesses, but there are those that have been proven to be scams.
In Georgia, a certain John Todd Williams was arrested by FBI agents on Tuesday morning. Williams is reported to be the founder of Williams, Scott & Associates, a debt collection company. He was arrested for allegedly masterminding a $4.1 million debt collection scam that targeted over 6,000 people all over the United States.
This first ever arrest of a debt collector is a result of an investigation made by the Federal Bureau of Investigation, the U.S. Attorney’s Office, the Federal Trade Commission and the Consumer Financial Protection Bureau. It is believe that this first coordinated action taken against collection agencies could be the start of a nationwide crackdown.
US Attorney Preet Bharara said, “We are far from finished looking at the seedy side of debt collection. It affects too many people.”
It is reported that employees of the debt collection company Williams, Scotts & Associates would call debtors and accuse them of committing a check fraud. They would constantly harass, threaten and trick thousands of victims by pretending to be detectives or investigators of local law enforcement agencies. And if the borrowers would not be able to pay the debt immediately, the collectors would tell them a warrant of arrest would be issued for them. All of these are direct violations of the federal law barring these companies from bullying, threatening or pressuring consumers to pay for their unpaid debts.