Collection Agency Settles FTC Credit Reporting Charges for $1 million

The Federal Trade Commission Wednesday announced the settlement of a case against a debt collection agency that involved charges of inaccurate credit reporting and ignoring debt validation requests.

Credit Bureau Collection Services, based in Columbus, Ohio, will pay a $1.1 million civil penalty and signed a consent decree promising to amend certain practices.

According to the FTC’s complaint, the company tried to collect invalid debts and reported them to the credit reporting agencies without noting that consumers disputed them. After receiving information from consumers that a debt was paid off or did not belong to the consumer, the company continued to assert that the consumer owed the debt, without trying to confirm or dispute the consumer’s information, in violation of the FTC Act and the Fair Debt Collection Practices Act (FDCPA). The company also is charged with violating the Fair Credit Reporting Act.

The company noted in a statement to insideARM that it had not admitted any wrongdoing in the settlement and that many of the practices in question took place years ago.

“Credit Bureau Collection Services has voluntarily entered into a consent decree with the Federal Trade Commission to settle a civil lawsuit, which contained allegations concerning its collection and credit reporting activities that took place several years ago, from 2005 to 2007,” the company said in its statement. “A Consent Decree is not a finding that the company has actually violated the law. Consent Decrees are for settlement purposes only and do not necessarily constitute an admission by a company of a violation of the law. While we disagree with the FTC, we have decided that the best business decision is to agree to enter into the Consent Decree so that we can continue to operate and remain focused on the needs of our business. We have implemented appropriate practices to comply with the requirements of the Consent Decree and the laws governing the industry.”