While the industry begins its shift to digital communication channels, telephone calls are still one of the primary methods of reaching consumers about their past due accounts. Unfortunately, due to several factors—the advent of call labeling technology, rules against third-party disclosure, and regulators’ warnings about answering unknown calls—consumers have become skeptical of telephone calls, even if they are from legitimate companies. 

Recognizing this issue, the Consumer Financial Protection Bureau (CFPB) released a video to help educate consumers about legitimate debt collection calls and how to differentiate them from debt collection scams. The three-minute-long video acts out an example of a fraudulent debt collection call and notes several details about what a legitimate debt collector would do in the hypothetical scenario. 

The video points out that, unlike a scammer, legitimate debt collectors would:

  • Not threaten to have someone arrested for not paying a debt.
  • Provide information about the debt, including how much is owed and to whom and would generally send such information to the consumer in writing. 
  • Want the consumer to know who they are and how to contact them by providing the company’s address and a callback number.
  • Help the consumer determine the best way to pay off their debts and arrange payments.

insideARM Perspective

One other difference between a legitimate debt collector and a scammer that was not pointed out in the video—but was readily apparent in the hypothetical call—is that the outset of a legitimate debt collection call will usually begin with the collector authenticating the identity of the consumer. To do this, debt collectors typically ask for and match certain identifying information in order to ensure the person they are speaking to is the right person before they can reveal anything about the purpose of the call. The fact that the scammer in the hypothetical call went right into providing information about the debt before requesting any sort of verification raises a flag that the call is not legitimate.


There are also nuanced differences between the type of information a legitimate debt collector and a scammer would ask for. For example, a legitimate debt collector would typically only ask for the last 4 digits of a social security number, whereas scammers would ask for the full social security number. 

Educating consumers is an important task of the CFPB, and the Bureau took a tremendous step with this video to help consumers spot legitimate debt collectors (and, more importantly, spot scammers). This effort is appreciated and applauded by the industry. If the CFPB was interested in suggestions, a great follow-up video that would be extremely beneficial to consumers and industry alike would be one about third-party disclosure and the authentication on the outset of debt collection calls.

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