Credit Bureau Collection Services, a Columbus, Ohio collection agency, will pay a civil fine of $1.1 million to settle Federal Trade Commission charges that it violated federal law by inaccurately reporting credit information and pushing consumers to pay debts they often did not owe, FTC officials said today.

The company and two of its officers, Larry Ebert and Brian Striker, illegally tried to collect invalid debts then reported them to the credit reporting agencies without noting that consumers disputed them, according to the FTC's complaint.

Even after receiving information from consumers that a debt was either resolved or did not belong to the consumer, the company violated the FTC Act and the Fair Debt Collection Practices Act by continuing to claim that the consumer owed the debt - without trying to confirm or dispute the information.

The company, which handles accounts nationwide, also is charged with violating the Fair Credit Reporting Act by reporting information to credit agencies that consumers had proved was inaccurate, failing to inform to the credit agencies that consumers had disputed the debts and failing to investigate after receiving a notice of dispute from a credit reporting agency.

Ebert, reached in his office today, declined comment and referred questions to Paul Werth Associates, a Columbus, Ohio public relations firm that released the following statement:

"Credit Bureau Collection Services has voluntarily entered into a consent decree with the Federal Trade Commission to settle a civil lawsuit, which contained allegations concerning its collection and  credit reporting activities that took place several years ago, from 2005 to 2007. A consent decree is not a finding that the company has actually violated the law. [They] are for settlement purposes only and do not necessarily constitute an admission by a company of a violation of the law."

The statement continued: "While we disagree with the FTC, we have decided that the best business decision is to agree to enter into the consent decree so that we can continue to operate and remain focused on the needs of our business. We have implemented appropriate practices to comply with the requirements of the consent decree and the laws governing the industry.

Along with the civil penalty, the settlement order: bars the defendants from making unsupported statements to collect a debt or obtain information about a consumer; prohibits them from making claims that a debt is owed, or about the amount, without a reasonable basis; requires them - when a debt is questionable or the consumers questions it - to either close the account and stop collection efforts or investigate the dispute. If they can't show that the consumer owes a debt, they can't sell the debt or provide it to any business other than the original client; and bars the company from re-reporting information to credit reporting agencies that it had voluntarily deleted from credit reporting before December 2008.

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