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FTC tightens its enforcement of various financial issues

Sep 23, 2013 Walt Wojciechowski

FTC tightens its enforcement of various financial issues

Businesses and consumers today are contending against a variety of novel challenges, such as data breaches, a turbulent economic situation in the United States and a growing volume of fraudulent scams that pose as critical financial activities. For example, more scammers are beginning to pretend to be debt collectors and credit management firms, all in efforts to steal sensitive information that can be used to perpetrate identity theft activities.

The fight needs to become more of a team effort, with debt collectors and credit risk managers stepping in to raise awareness about these issues. While the federal government has become highly active in the war against these fraudulent parties, there is still a lot of room for support, especially as businesses and consumers continue to struggle to avoid these increasingly common activities.

FTC gets real

Consumer Affairs recently reported that the Federal Trade Commission (FTC) has imposed a $25 million judgment against a repeat offender of fraud who persistently bilked businesses and consumers through a fraudulent debt collection set up. Along with a variety of other parties, all of which are now being deposed by the FTC, the man used fake collection calls to trick consumers into giving personal information.

Additionally, the source explained that the fraud scheme also claimed that they would reduce consumer credit card interest rates and, obviously, they did not. This strategy was not the only one that the FTC discovered when investigating the ring leader and his co-defendants, as officials found that they were calling consumers and saying that they could help with debt relief.

This has been an increasingly serious issue for consumers and businesses, and the worst part is that the perpetrators are preying on those who most need real assistance. Fraudulent mortgage and credit card debt relief operations have spread like wildfire in the midst of the economic recovery, as organizations and the general population work to pay down outstanding loans accumulated during the financial crisis.

The source explained that this specific case was highly damaging, as it effectively tricked and stole from thousands of consumers throughout the past several years.

Protect this house
Debt collection agencies and credit risk managers should not stand by while fraudulent parties pose as actual members of their respective industries. These criminals do not only affect consumers and businesses, but also come with the risk of further hurting the reputation of what should be reputable sectors.

More consumer and business advocacy groups are calling for increased awareness training for all organizations and the general population, as knowledge can lead to a dramatic decrease in the rate of associated crimes, including identity theft. Debt collectors and credit risk managers are best positioned to educate current and prospective clientele in the most telling signs of fraudulent activity.

While the FTC and other regulatory entities will continue efforts to find these criminals and bring them to justice, organizations in these sectors can boost their own reputations and improve the standing of their industries by putting in the extra effort to raise awareness of consumer rights.