It's one thing to be harassed about an unpaid bill. It's another thing to be harassed about a bill you never actually owed.
Brandy De Alba, a California resident, says she canceled her alarm service with CastleRock Security in 2009, yet last year she began receiving letters from debt collectors claiming that she owed the company $449, CBS Sacramento reported. De Alba thought she had resolved the issue in January after the alarm company said it would eliminate the debt from its books and restore the 100 points that had been deducted from her credit score in the process.
But since then, De Alba has been contacted two more times by collectors who insist she still must pay the $449 bill.
“I’m stuck. I actually have no power in this, I feel powerless,” De Alba told CBS Sacramento’s Kurtis Ming. “All of a sudden, I’m being punished for something I did not do.”
The Federal Trade Commission received a record-high number of complaints about debt collectors in 2011, the Wall Street Journal reported. The WSJ linked the 17 percent higher jump in annual complaints to the weak economy.
In one of the more offensive cases of debt collector harassment, a hospital in Minnesota working in conjunction with Accretive Health, a debt-collection firm, was charged by the federal government in September for allegedly harassing sick patients for money while they were still in the emergency room. Earlier this month, a disabled U.S. Army veteran claimed that a representative of the debt-collection agency Gurstel Chargo told him “you should have died” after garnishing his wages illegally.
The FTC provides a list of consumers' rights to protect against illegal debt collection practices. Debt collectors are not allowed to contact you at inconvenient times, you must first be sent a written notice telling you how much you owe and debt collectors must stop contacting you once you send a letter stating that you don’t owe any money.
CBS reportedly reached out to CastleRock on De Alba's behalf. According to the station, the security company said they had no record of her closing the account, but agreed to buy back the debt from the debt collection company.
It seems De Alba isn't the only person being charged phantom bills by CastleRock. According to the Consumerist, the security company is being sued by a State Attorney in Illinois under claims that it does not honor its cancellation contracts.
As for De Alba? She finally received a letter from the alarm company putting an end to the nightmare. “[We] agree that it should not have happened," the letter stated. "We consider your account closed and in good standing.”
Check out some more debt collector horror stories:
Bruce Folken was still "out of it" when a hospital employee entered his room and asked if he wanted "to pay now." Afraid the care he was being given would suffer if he said no, Folken agreed as the employee took his debit card from his wallet and charged him $493.60, The Huffington Post reports.
Breast cancer survivor Lisa Lindsay of Illinois was taken from her home in handcuffs and put in debtors' prison over a $280 medical bill that was sent to her by accident. Eventually, she agreed to pay $600 just to settle the charges.
According to the FTC, employees at one debt collection agency threatened a debtor by saying they would "dig her daughter up and hang her from a tree if she did not pay the debt," The New York Times reports.
The West Virginia attorney general filed suits in April against seven debt collectors for allegedly impersonating police officers in order to harass borrowers who in some cases didn't even owe any money.
Eighty-five year-old Anne Sessions spent hours in the hospital incurring a $1,055 medical bill when debt collectors called authorities to falsely report that she was threatening suicide. The debt collector reportedly asked her "how would you do it?"
Colorado resident Kelly Wiedemer spent four nights in debtors prison in June 2011 when a police officer pulled her over for having unregistered plates and discovered she still owed money from an accident that happened in 2009. "I thought debtors' prison was supposed to be unconstitutional," Wiedemer said.
Debt collectors will "set up fake profiles and friend consumers on Facebook, just to get into their personal information," according to one financial planner.
The FTC charged Rincon and six other debt collection agencies for using threats and insults to try and collect money from people who didn't actually owe any.
When an official-sounding debt collector told Wayne and Brenda Foster they'd be dealing with police unless they paid up, the couple reached for their wallets. So did hundreds of others. But thanks to an FTC investigation of fake debt collectors, the multimillion dollar scheme to rip off consumers was shut down in April.
Turns out nice guys don't always finish last. Debt collector Access Receivables increased payments by 40 percent after adopting a new "nice people" strategy emphasizing customer service.