WASHINGTON - One of the nation's largest consumer debt buyers will pay a $2.5 million civil fine to settle allegations of deception.
The Federal Trade Commission said Monday that Michigan-based Asset Acceptance agreed to the penalty and to changes in the way it collects debt. The company buys unpaid debts from credit card companies, utilities, health clubs and others.
The FTC alleged that Asset tried to collect debt in some cases that wasn't even owed. In other cases, the FTC says the company told consumers they owed a debt that may have been too old to collect because it was past the statute of limitations. Making a payment could then restart the clock on the debt and allow collectors to take legal action.
As part of the proposed settlement, Asset Acceptance will have to tell consumers that their debt may be too old to be legally enforceable and that it won't sue to collect on that debt.
The company also will be barred from noting debt on a consumer's credit report without informing the consumer about the negative report.