Ohio Attorney General Mike DeWine's office received more than 2,400 collection complaints in 2013, with hundreds of those complaints involving potential scams.

Consumers taken advantage of by collection scams often report losing $200 to $300, though some lose thousands, according to DeWine's office.

A typical collection scam starts with a phone call from someone stating the consumer is in default on a loan. The caller threatens to have the consumer arrested or thrown in jail unless the consumer pays immediately, often via wire transfer or prepaid money card. Ultimately, the caller is not a legitimate debt collector and any money the consumer sends will be lost.

Consumers who have applied for payday loans online may be especially at risk, according to DeWine's office.

“It can be difficult to tell the difference between a legitimate debt collector and a con artist, because some con artists are very convincing,” according to a statement from DeWine's office. “It’s also tempting to want to pay right away to avoid problems, but it’s important to get verification of the debt. Paying a scammer won’t solve any problems.”

Signs of a collection scam, the AG's office reports, include:

  • Refusal to provide documentation of the debt
  • Requests for immediate payment
  • Requests for payment via prepaid money card or wire transfer
  • Threats of arrest or jail time
  • Callers who say criminal charges will be filed unless payment is provided immediately
  • Requests for a consumer’s Social Security number or other personal information
  • Use of vulgar language

Under the Fair Debt Collection Practices Act, third-party collectors must send a letter within five days after first contacting the consumer by phone. The letter must include the amount of money owed, the lender the debt is owed to, and the amount of time the consumer has to dispute the debt. Consumers also have the right to request validation of a debt by sending the collector a letter.
Third-party collectors also cannot contact consumers without identifying themselves, tell others about the debt, or contact consumers at work if they or their employer disapproves.

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