Feds fine debt collector Allied Interstate for repeat violations

FTC LOGOA debt collection agency has been slapped with a near-record fine by the Federal Trade Commission for repeatedly trying to collect from the wrong people, collecting the wrong amounts, using abusive language and other unlawful practices.

Allied Interstate, Inc., a Minnesota-based corporation with offices in the U.S., Canada, India, and the Philippines, will pay $1.75 million to settle FTC charges of repeated violations of both the Fair Debt Collection Practices Act and Section 5 of the Federal Trade Commission Act.

Allied's settlement marks the second-largest civil fine levied by the FTC against a debt collector.

"Debt collectors had better make sure their information is accurate, or they could end up paying a big penalty," said David Vladeck, Director of the FTC's Bureau of Consumer Protection, in a statement. "There is no excuse for trying to collect debt from someone if you can't confirm that they actually owe it."

According to the FTC's complaint, between 2006 and at least 2008, Allied Interstate persisted in debt collection efforts even after consumers told company representatives they didn't owe the debt in question. The company also failed to verify the accuracy of the disputed information. The FTC accused Allied of making harassing phone calls to consumers, using abusive language, calling many times a day for weeks or months, and sometimes hanging up when the calls were answered.

In addition, Allied repeatedly called third parties seeking to locate a consumer, revealed alleged debts to third parties without the consumers' consent or court permission, and threatened legal action against consumers it did never intend to take. Collectively, these practices violated both the Fair Debt Collection Practices Act and Section 5 of the Federal Trade Commission Act.

Besides the $1.75 million fine, Allied will be required to take specific steps whenever:
  • A consumer disputes that he or she owes the debt or the amount of the debt.
  • A reasonable person would consider the information on which Allied is relying to collect the debt to be implausible, unreliable or missing essential information.
Regardless of the circumstance, Allied must now either close the account and end collection efforts or suspend collection until it has conducted a reasonable investigation and verified that its information about the debt is accurate and complete. If Allied cannot substantiate that the consumer owes the debt, the company cannot sell the debt or provide it to any business other than the client from which it obtained the debt.

The consent decree also bars Allied from:
  • Making false statements to collect a debt or obtain information about a consumer.
  • Making claims that a debt is owed or about the amount without a reasonable basis.
  • Asking a third party for a consumer's location information more than once without that third party's consent or a reasonable belief that the person's earlier response was wrong or incomplete and that the person now has correct location information.
  • Communicating with third parties about a consumer's debt without the consumer's consent or court permission
  • Using obscene or profane language or harassing consumers with repeated phone calls;
  • Making any other false or misleading statement in collecting a debt, including threatening action it does not intend to take.
  • Violating the Fair Debt Collection Practices Act.
New FTC regulations governing the telemarketing of debt-relief services take effect on Wednesday, October, 27.

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Paeslie Taylor

GOOD! They repeatedly called my father (who lives at a different residence) looking for me ( I don't even know how they got his cell phone #) and they threatened him for "harboring an irresponsible criminal because I stole from the government" -this was for my student loan that had already been paid off at the time. Yes, ALREADY PAID OFF but yet they persisted to try and collect about half of my total loan. I'm glad they finally got fined. I was hoping for a total shutdown to be honest. Completely unprofessional and just down right scam artists. I feel bad for anyone that gave them a credit card number over the phone, I heard they charged whatever they wanted whenever they wanted. smh such a shame that there are people conducting what they would consider "business" like this.

November 08 2013 at 12:25 PM Report abuse rate up rate down Reply
Yee Vang

I had a debt collector, Marisa Legare, from Interstate Recovery Service called me for a debt I owe for a magazine company (CountryWide Periodicals INC) last week. We agreed upon a two payment plan and I did authorize them to pay the 1st payment with my debit card (wrong mistake). However, the 2nd payment, the debt collector pull out money from my bank account to pay off my debt with no authorization or no call to notify they took out money from my account. Also the debt collector claimed that I had a second account or debt I owe for a magazine company in 2006.

Secondly, the same debt collector, Marisa Legare, claimed that I owe an amount of $400 to another magazine company from 2006. I told her I don't have any account with any magazine company in 2006 and asked her to give me information on what magazine company, what address, city, and state the magazine was sent to. She was unable to answer most of my questions and reply that it was just a magazine company that she doesn't know because it wasn't listed nor any information about it besides that it was from 2006. So she handed the phone to another collector or manager (i dont know) and she ask me a few question to verify to see if i was the right person. If I was from Fresno or live there in 2006 and ask me if this social security was mine. I told her none of it matches me and let her know my time frame of where I was located during that time period. So throughout the whole time they had the wrong person just because we had the same name.

Thirdly or lastly, they still kept calling me til this day everyday in the morning about the second account. Claiming that I owe the magazine company and I am the correct person they are targeting. As I reply to them, you are the second person or third person or etc. to call me about this matter and that I needed to talk to the manager and to get their name.

As I would like to file a complaint to the FTC about Interstate Recovery Service, for trying to collect from the wrong person, continuously calling me the same matter, and taking money from my account with no authorizations.

October 04 2013 at 7:09 PM Report abuse rate up rate down Reply
TheMad Hatter

I recently had landline service installed by my cable company. Since day one this company "allied interstate" has been calling my house looking for someone I don't even know, and never have known. I've explained to them it's a new phone number I just got installed, that no I don't know the person they're wanting, to stop calling my house, and to take my private unlisted number off their call list. To no avail. They still continue to call, three to five times a day, looking for someone I don't know and never have known, at all hours of the day and night. So I too would like to file a complaint against this company. If someone knows more on how to do so please post it here in reply, it will be much appreciated.

July 22 2013 at 1:26 PM Report abuse rate up rate down Reply
blackesther

They're harassing me!! EGH!

July 06 2013 at 9:08 AM Report abuse rate up rate down Reply
Sarah Vought

Who is the person named Joseph? He called me and told me that he is a debt collector that works for Allied Interstate and is working through Sallie Mae to get their money paid. He called me when I was sleeping and harassed me and even had the nerve to ask who was talking in the background (who was my boyfriend asking who was talking to that Joseph was on the phone) and actually asked me if my boyfriend was trying to not get me to pay the money. He just kept on harassing me in a tone of voice and kept going on with the way he was talking. Like it's any of his business who is in the background and everything else that goes on in my life like he's my father. The debt collector named Joseph at phone number +1-877-254-7132 that is placed in Minnesota. This Joseph person said that he was sending me a paper to sign in the mail for authorization to withdraw money from my savings account. I haven't received anything yet in the mail and it has been a week and a half. I tried to call this Joseph back since this past Tuesday and it is now Saturday and the person never called back. Is this bad or good? I think this is fishy and I am changing my bank account number.

April 15 2012 at 4:41 AM Report abuse rate up rate down Reply
Trina

They are in violation of my privacy and continue to harass me and my family by constantly calling my home at all hours of the day. Thank you for you assistance. Have a nice day. Please contact me as soon as possible. I will update you if the should call again.

December 07 2011 at 9:02 AM Report abuse rate up rate down Reply
Trina

I want to file a complaint against them can someone help me. I am not that person and never had an account with them. I don't know who Allied Interstate is and never heard of them. Who are they?

December 07 2011 at 8:59 AM Report abuse rate up rate down Reply
Trina

I would like to report this agency. There was someone calling me today at 8:35 a.m and last night 10:30 a.m. He asked me my name and wanted to know my address.I do not know this agency or who they are. My credit report doesn't show I owe anyone. But the agencies that are already there, besides that's been more than 16 years ago. I want to be apart of this law suit. For harassment and fraudulent debt collection. Please contact me at emerald6786@yahoo.com

December 07 2011 at 8:58 AM Report abuse rate up rate down Reply