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Phantom Debt Collection happens when scam debt collectors try to trick their victims into paying a debt that doesn’t exist. These phony debt collectors often contact older adults by phone and refuse to answer questions about themselves and the underlying debt. Phony debt collectors may have some information about the older person that they’ll use to appear to be legitimate. Scam debt collector my use scare tactics and may threaten to do things that they can’t do, such as arresting the older person or physically hurting him/her unless the debt is paid immediately. Here are some additional characteristics of this type of scam:- You do not recognize the debt, and the debt collector refuses to give you information about the debt.
- The debt collector refuses to give you a mailing address or phone number
- The debt collector claims that it can press criminal charges against you, if you refuse to pay the debt collector immediately.
- The debt collector asks you for sensitive personal financial information.
- The debt collector asks you to use an anonymous way to pay, such as buying and sending a prepaid debit card, providing the card number over the phone, or using a wire transfer or an electronic transfer from your bank account.
If you receive a call from someone claiming to be a debt collector, ask for more information. Don’t ignore your suspicions if you don’t recognize the debt, and don’t give in to threats.
- Ask the caller for his or her name, company, street address, and telephone number.
- View sample letters you can use to respond to debt collectors
- If you dispute the debt or ask for the name of the original creditor in writing within 30 days of the caller’s first communication, the debt collector usually has to stop all debt collection activities until it verifies the debt or provides that information to you.
- If you can’t verify the information the collector provides, do not give money or your financial information (such as bank account number or credit card number) to the caller or company.
- Do not give the caller your financial or personal information such as your social security number or date of birth.
- Keep the letters or documents a debt collector sends you, and keep copies of anything you send to a debt collector. You can also write down dates and times of conversations along with notes about what you discussed. These records can help you remember, or show others what actually happened.
You can submit a complaint to the CFPB (1-855-411-2372) and you can contact the Indiana Attorney General’s office.
Additional Information
- FTC freezes debt collectors seeking payment of ‘phantom’ debts
- FTC busts "phantom debt" collection scheme
- What Is Zombie Debt?
- How to Fight Phantom Debt
The views, information, or opinions expressed in this article are solely those of the author and do not necessarily represent the views of Citizens State Bank and its affiliates, and Citizens State Bank is not responsible for and does not verify the accuracy of any information contained in this article or items hyperlinked within. This is for informational purposes and is no way intended to provide legal advice.