Recently I wrote about how JP Morgan Chase is scared to death about the coming changes to the debt collection industry. So scared in fact that they decided to give up $100 per quarter…that’s mucho dinero!
Other recent news to hit the wires exemplify how the Federal Trade Commission is intensifying its crack down on collection agencies.
First off, the FTC levied its second largest penalty against a debt collector. Asset Acceptance Capital Corp recently announced a $2.5 million settlement for allegedly coercing borrowers into paying debts they no longer legally owed. The U.S. District Court in Florida alleged that the company failed to inform customers that they could not be sued to collect the money that was being pursued. U.S. officials further alleged that the company actually instructed its employees to go after debts that were beyond the states statute of limitations.
In addition, yesterday Attorney General Mike DeWine (of Ohio) announced a settlement with NCO Financial Systems (a subsidiary of NCO) for up to $1.5 million in restitution to the AG offices and consumers in 19 states. Lawsuits like this one are surely a major reason why NCO has decided to leave the debt collection business.
As government agencies such as the FTC and the Consumer Financial Protection Bureau continue to turn up the heat, more and more collection agencies will be forced out of business.
Because their business models will crumble under the tougher regulations.
On the other hand, companies who were smart enough to see the writing on the wall and build their business plans around the coming new landscape will reap the enormous benefits from this once in a lifetime opportunity…YOUR WELCOME!
Do Good and Make Money!