Home > Uncategorized > How a Reporter Became the Target of a Phantom Debt Collector

Comments 0 Comments

How persistent and brazen are phantom debt collectors? Last month, when I emailed a firm named Advance Cash Services asking for comment on collection harassment allegations, the firm replied by saying I owed them $935.76 for an unpaid payday loan.

A few days later, I wrote about Susan Marquardt of Chicago, who says she was harassed by ACS, which alleged that she owed $4,526. And in the usual space reserved for comment from the accused company, we published the “comment” I’d received claiming I owed them money too. And we all had a laugh.

You might assume that national syndication of such a goofy incident would get ACS to “call off the dogs” on me. But you’d be wrong.

Late last week, ACS upped the stakes and sent me this email, suggesting “charges” against me were imminent:

Your Case File is being transferred to United States District Court 500 Pearl Street, New York, NY 10007 in order to take legal action against you within 48 Hours According to Section(9) and Chapter(19).

Having checked your Social Security Number through our National Checking Database System, and finding out that you have been never charged for a fraud activity,

If you fail to respond us the Charges will be pressed against the name are:

1. Violation of federal banking regulation act 1983 (C)

2. Collateral check fraud

3. Theft by deception (ACC ACT 21A)


Yours sincerely

Advance Cash Services Collections & Legal Department.

Again, I replied to the note, telling the sender I was a reporter seeking a comment and this time noted that I wanted to give ACS a chance to comment because publication of this email was also imminent. Against my better judgment, I sent along a phone number so the firm could call me. I haven’t received a response yet.

I called a number listed for ACS on the Better Business Bureau website and was told I had reached a wrong number. I also tried many of the contact emails and phone numbers listed on this Washington State Department of Financial Institutions website on ACS warning about “what appears to be a collection scam” to no avail. That landing page was first created in 2011 but updated in 2015.

So, all at once you can see how relentless phantom debt collectors can be and how persistent that alleged scam is.

Dealing With a Phantom Debt

My story is funny, but phantom debt collection is no laughing matter. It is a scam that persists because it works.

Nearly every week brings news of some other operation being sued by state and federal officials. Last week, the Minnesota state attorney general sued an operation based in Jamaica. As an example, state officials said an elderly couple in St. Cloud paid $400 to pay off a payday loan from a firm she’d never heard of … and then received more harassing calls.

A quick scan of the Federal Trade Commission website shows dozens of similar actions by that agency, stretching over several years. Many of the cases involve consumers who did indeed apply for a payday loan online at some point. That meant they’d shared a lot of personal information, which somehow gets into the hands of phantom debt collectors. So that’s lesson No. 1 from this story: Applying for a high-interest, high fee payday loan online can lead to trouble in more ways than one. But the big lesson is this: Anyone can email you or call you and claim you owe them money. Anyone.

The only barrier is a phone number or an email address. After all, if you are running a debt collection scam, the marginal cost increase to adding your email or phone to their campaign is nearly zero. So you should take any message claiming you owe money with a grain of salt. It’s a best practice to always demand proof that the debt exists and always get a mailing address and phone number, then hang up and call back. It’s also good to have your state attorney general’s office on speed dial in case something seems wrong.

If you are reading this story, you probably know all this. But no doubt, somewhere among your set of friends and family is someone who is more vulnerable than you think. Maybe it’s an elderly relative who is easily confused; maybe it’s a friend who has silently fallen on hard times and does hold legitimate debts. (You can see how your debts are affecting your credit by viewing two of your credit scores for free each month on Credit.com.) These folks can be tricked into paying up, so talk to them often. Ask them questions about their finances or even share this story with them so they’ll have some tips on hand for dealing with potential con-artists.

Image: MartinPrescott

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team