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FTC settles with defendants in abusive debt collection operation

150px-US-FederalTradeCommission-Seal.svgThe FTC has reached a settlement with the remaining defendants in a claim against Rumson, Bolling & Associates that permanently bans them from the debt collection business over their abusive and deceptive business practices.

Three debt collection firms, including Forensic Case Management Services, which was doing business as Rumson, Bolling & Associates, Specialized Recovery and Commercial Receivables Acquisition, as well as owner David M. Hynes II and the companies’ principals allegedly subjected customers to degrading and obscene language, threatened them with physical harm and improperly disclosed their debt to other parties, including neighbors and co-workers.Lagersalg

The defendants also allegedly falsely threatened customers with lawsuits, seizure of property and arrest. Several consumers also reported that the defendants threatened to exhume the bodies of deceased relatives over alleged non-payment of funeral receipts.

Under the settlement, the defendants were ordered to pay $33.8 million, though the judgment has been suspended because the parties are unable to pay after turning over $700,000 and the FTC obtained more than $400,000 in a separate settlement with Hynes over three other firms he controlled, which allegedly received funds from the defendants.

The FTC also alleges that the defendants deceived small business clients by promising that they would collect clients’ past-due accounts or they would not pay. In many cases, the FTC alleges that the defendants collected money for a client and kept all or more than they were entitled to.

The defendants’ alleged practices violate the Fair Debt Collection Practices Act, which prohibits the use of deceptive, abusive or unfair debt collection practices, as well as the FTC Act, which prohibits deceptive and unfair commercial practices in general.

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