MADISON, Wis. (8/22/13)--Wisconsin consumers should be on the alert for phone calls from unscrupulous debt collectors, the Wisconsin Department of Financial Institutions (DFI) warned Wednesday.
Callers will often state they are attempting to serve a summons and if consumers do not "act immediately," they will be arrested. The callers do not represent law enforcement and any threats of arrest or jail are bogus, the DFI said.
Credit unions may want to alert their members about the scams and be prepared to share advice on handling such calls.
DFI's Bureau of Consumer Affairs receives several phone calls per day regarding these types of complaints. Since Jan. 1, it has fielded more than 100 written complaints.
"In many cases, we suspect that consumers may have applied for or obtained loans on the internet or, at the very least, may have entered their personal information into an Internet application," said
Paul Egide, DFI director of the bureau of consumer affairs. "That information is then fraudulently obtained by the perpetrators, who target consumers for collection of debt the consumers do not owe, or at least do not owe the debt to the company that is calling."
In other cases, companies that have purchased the accounts and have a legitimate right to collect a debt may also be engaging in illegal collection practices, Egide said. Debt collectors that "own" consumer credit accounts for purposes of direct collection are required to register with DFI.
Credit unions can share these tips offered by DFI to consumers targeted by callers:
Ask for verification that the debt is owed. Collectors are required by law to provide such documentation or discontinue collection activities. They also are required to provide written evidence of their identity and where they are located.
Do not provide a caller with any personal identification or payment information.
Do not purchase money cards or money orders to pay the alleged debt.
If calls are received at work, speak with your employer to come up with a plan on how to handle the calls.