The Federal Trade Commission Tuesday said that in 2012, it received over 2 million complaints from consumers for the first time ever. Nearly 200,000 of those complaints dealt with debt collection, making it the most common complaint behind identity theft.
The FTC said that it received 199,721 unverified complaints about debt collection: 178,009 dealt with third party debt collection while the remaining 23,197 complaints were about the internal collection efforts of creditors.
While the total number of complaints against third party collectors were up from the 160,000 reported in 2011, the rate of growth has declined significantly. In 2010, third party debt collection complaints increased 25 percent, followed by a 32 percent spike in 2011. For 2012, the complaints increased 11 percent.
The FTC’s complaints report from the Consumer Sentinel Network (CSN) is compiled from a network of reporting groups that include the FTC itself – through its Web site, regular mail, or toll-free numbers – Better Business Bureau units, a handful of state enforcement groups like attorneys general, and private partners such as Publishers Clearing House and PrivacyStar. The FTC notes that the complaint numbers from CSN are “based on unverified complaints reported by consumers.”
The unverified nature of the reported complaints has been noted by many in the ARM industry as a primary reason the FTC’s numbers cannot be used as an accurate measure of consumer feelings toward collectors. Also, after an exhaustive analysis of complaint data last year by insideARM.com, we noted the role scam operators have on debt collection complaints. Stephanie Eidelman discusses this in a blog post today.
For more on debt collection complaints, please visit our Complaints Issue, published last year.
Here are the top consumer complaints from the FTC for 2012:
|Category||Number||% of Total Complaints|
|Banks and Lenders||132,340||6%|
|Shop-at-Home and Catalog Sales||115,184||6%|
|Prizes, Sweepstakes and Lotteries||98,479||5%|
|Auto Related Complaints||78,062||4%|
|Telephone and Mobile Services||76,783||4%|
|Foreign Money Offers and Counterfeit Check Scams||46,112||2%|
|Advance Payments for Credit Services||42,974||2%|
|Television and Electronic Media||41,664||2%|
|Mortgage Foreclosure Relief and Debt Management||33,791||2%|
|Business and Job Opportunities||32,496||2%|
|Travel, Vacations and Timeshare Plans||30,324||1%|
|Credit Bureaus, Information Furnishers and Report Users||29,268||1%|
|Office Supplies and Services||24,210||1%|
- FTC Debt Collection Complaints Compendium
- The Debt Collection Compliance Handbook
- The Complaints Issue