The federal government is seeking to shut down a California-based operation described as a "shake-down debt-collection enterprise" that has collected more than $9.4 million in about two years - some of it from individuals who owed nothing.
U.S. District Court Judge Virginia A. Phillips granted a temporary restraining order against the businesses named in a Federal Trade Commission civil action.
Several businesses are named as defendants in the FTC filing: Rincon Management Services LLC; Prime West Management Recovery LLC; Union Management Services LLC; National Filing Services LLC; Investment Services LLC; Global Filing Services LLC; and Pacific Management Recovery LLC.
Collectors speaking English and Spanish called individuals nationwide and falsely represented themselves as process servers, lawyers or legal office staff and claimed the people who picked up the phone were facing a lawsuit over an unpaid debt.
A returned call put the consumer in touch with a collector who turned up the heat with escalated threats including wage garnishment or property seizure. Some collectors claimed they were law enforcement and threatened arrest, according to documents filed in the case.
Also named in the civil action are two men said in court documents to be behind the companies, Jason R. Begley and Wayne W. Lunsford. “Defendants have operated their deceptive and abusive scheme since March 2009,” the documents say.
Court records show no attorneys representing either the men or the businesses. A listed phone number for a man matching Begley’s name in Riverside reached a solar power company. The operator said no one named Jason Begley worked there. A number for a man matching Lunsford’s name in Sun City was disconnected.
In papers filed in Phillips’ court, an FTC investigator outlined a sophisticated operation with its collectors following a script to deal with questions and challenges from people they called.
“Defendants represent to the consumer that he can ‘settle’ the case by making an immediate payment to the defendants. In fact, no lawsuit has been filed nor will soon be filed against the consumer. Defendants simply use these tactics in an attempt to unlawfully collect money from the consumer,” the papers state.
