Texas Court Orders $2 Million Penalty for Debt Collector
A federal court in Texas ordered Timothy L. Ford, president of Commercial Recovery Systems, Inc., to pay $2 million in penalties for a violation of the Fair Debt Collection Practices Act. The verdict came at the request of the Federal Trade Commission.
Ford was accused of falsely threatening debtors, a significant violation of the FDCPA. The U.S. Department of Justice filed the case on the FTC’s behalf in January 2015, alleging collectors from CRS falsely claimed the company would sue its debtors, levy their bank accounts, garnish wages and/or seize their assets unless they provided payment.
As of April 2016, Ford and CRS have been banned from the debt collection industry due to a permanent injunction issued by the U.S. District Court for the Eastern District of Texas. A former CRS vice president, David Devany, is also banned from the industry after settling with the FTC in September 2016.
This latest action is a part of Operation Collection Protection, which has been an ongoing federal, local and state crackdown on deceptive and abusive debt collectors. The effort is focused on illegal and unethical practices happening in the industry.
Consumer protections available against abusive creditors
Although people are expected to meet their financial obligations in terms of money owed to creditors, they are also protected under a variety of state and federal laws against abuse on the part of debt collectors. If you have been threatened or otherwise hassled or abused by one of these agencies, contact a trusted Dallas attorney at Whistleblower Law for Managers to learn more about your options.