US FTC seeks civil penalty for debt collectors
WASHINGTON, March 24 (Reuters) - The U.S. Federal Trade Commission on Wednesday said it will hit a debt collection company and its subsidiary with a $300,000 civil penalty to settle charges of harassing and browbeating borrowers.
The FTC said Capital Acquisitions and Management Corp., its subsidiary, RM Financial Services, Inc., and four principals violated debt collection laws throughout the United States in trying to get consumers to pay old debts.
The collectors could not have claimed most of the debts in court, for example, those that had been discharged in bankruptcy proceedings, the FTC said.
The government said the companies harassed consumers at their workplaces, used obscene language, and misrepresented the amount and legal status of consumers' debts.
The FTC said the collectors threatened people with imprisonment and said they would pass on information about debts to employers or credit rating agencies even though the debts were past time limits for credit reporting.
The government said the principals -- Reese Waugh, Jerome Kuebler, Scott R. Franson, and Mario Bianchi -- were directly involved in violations of the law.
"The Commission is accepting this settlement because there is ample evidence of the defendants' liability," FTC Chairman Timothy Muris said in a statement.
CAMCO, RM Financial Services, or the principals could not immediately be reached for comment. Neither CAMCO, RM Financial Services, nor the principals have admitted to any wrongdoing, the FTC said.
The settlement prohibits CAMCO and its subsidiary from further such practices and requires them to inform consumers of their rights in communications with them.
The settlement was filed and approved by a judge on Wednesday in the U.S. District Court for the Northern District of Illinois in Rockford, Illinois by the Department of Justice at the request of the FTC.
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