There seems to be a lot of confusion about what debt collectors have the authority to do. Admittedly, some collection agents might intentionally lie or insinuate that they can do more than they legally can to intimidate debtors. Generally the main factor that will motivate debtors to pay is the persistence of correspondence from the collection agency. If they do not pay, they know that the letters and phone calls will not stop.

Collection agents do have the power to negatively mark credit scores which can do a lot of financial damage and remain on the report for seven years. If a debtor is especially resistant and obviously has assets, a third party collection agent will either recommend that the creditor sue them, or if they own the debt themselves, they are entitled to sue themselves.

Contrary to popular belief, debt collectors can’t seize a debtor’s bank accounts, assets, or garnish wages unless there has been a successful lawsuit already with a judgment against them. Debt collectors are strictly banned from making the debt public. The only entity that they can discuss the debt with is the credit bureaus. They can not get a debtor fired from their job, and if a collector was to threaten violence on a debtor for the purposes of intimidation, they would almost certainly be fired, and perhaps sued.

Again, debtors usually repay their debts to collection agencies to stop the constant contact, but oftentimes, most debtors realize that the debt is legitimate and it is the right thing to do. Perhaps they did not have the money to pay on the delinquent account in the past, but have it now, or maybe the account simply slipped their mind.

Because there are so many negative stereotypes about debt collectors, it is ironic that it is many times the collectors themselves that enable the debtor to repay their debt. Collectors typically have the authority to offer some type of repayment plan or debt reduction plan, or in some cases, both. Because of their two main capabilities, one being the authority to damage your credit score, and two being the authority to make it easier to pay, it is never a good idea to simply ignore a call from the debt collector.

Mallory Megan works for Rapid Recovery Solution and writes articles on commercial collection agencies

In recent news it was revealed that powerful prosecutors in Louisiana and Washington made announcements of actions they had obtained against debt collection agencies and their owners and managers.

Louisiana’s attorney general James Caldwell announced on Friday that his office had gotten a hold of injunctions against two collection agencies and their owners. On the same day, Rob McKenna, Washington’s Attorney General said that his office had settled charges with a collection agency that had promised to stay on the straightened arrow. In a press release, Caldwell’s office stated that in late December they had gotten a hold of an injunction against Bush and Kennedy, Inc, a Baton Rouge based collection company. The order he won placed restrictions on the business, banning them from operating further, and specifically, ordered that two of the firm’s principals, Quay W. Pattott Jr, and William S. Fesguson were banned from conducting business together.

Late last week, a judge hit Ferguson and Parrott with additional injunctions as was requested by Caldwell’s office. Ferguson is barred from using deceptive and unfair acts and practices at his current place of business, Franklin, Grant and Associates Incorporated, a collection agency based out of Metairie Louisiana. Parrott is completely restricted against conducting any new business at his new place of work, Metairie based Halsey and Associates, LLC.

McKenna’s Washington office said that Topco Financial Services Inc, a Washington based collection agency agreed not to threaten, harass or curse out debtors as part of a settlement. The collection agency has been ordered to pay around $38,000 in legal fees and penalties. An additional $82,000 in fees and penalties were suspended provided that the company agrees with the settlement terms.

As per the agreement, Topco is restricted from harassing, intimidating, threatening and embarrassing debtors, including using profanity. They are banned from implying that failure to pay a delinquent bill will result in suspension, a revocation, or impairment of the debtor’s driver’s license. They are no longer allowed to threaten debtors with impairment of their credit rating. However, the company is allowed to legally report debts to credit reporting agencies.

Mallory Megan is employed by a debt collection agency. She also writes articles on business and finance, consumer spending and collection agencies.