West Asset Management Inc., the debt collection unit of West Corp., has agreed to pay $2.8 million to settle charges it used aggressive collection methods that violated federal law, according to the Federal Trade Commission. The civil penalty is the largest obtained by the FTC in a collection case.
The FTC alleged the company violated the FTC Act and Fair Debt Collection Practices Act. The settlement was announced Wednesday.
According to the FTC's complaint, thousands of consumer complaints have been filed against West Asset Management, which employs 1,500 collectors in 13 states and one offshore location. West Asset Management collectors allegedly called consumers multiple times each day, often regarding accounts that did not belong to them and sometimes using rude and abusive language.
The FTC also charged that West Asset Management illegally disclosed consumers' debts to third parties and ignored consumers' written requests to stop calling.
West Asset Management also allegedly withdrew funds from consumers' bank accounts or charged their credit cards without consent, and falsely claimed that consumers would be sued, arrested or have their property seized for nonpayment of debt. Finally, the FTC alleged that West Asset Management falsely claimed partial payments would be accepted as full settlement on accounts and that negative information would stay on consumers' credit reports until debts were paid.
According to the complaint, West Asset Management has collected on more than 24 million accounts on behalf of clients in the health care, telecommunications, consumer credit and government service industries.
Officials at West Corp. were not immediately available for comment on the settlement. The order permanently prohibits the company from using false, deceptive or unfair debt collection tactics.
