FTC Mails Debt Collection Scam Refund Checks

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At the end of June, the Federal Trade Commission announced that it was in the process of mailing 95,000 refund checks as compensation for a debt collection scheme perpetrated by Asset Capital and Management Group. Consumers will have until Aug. 29, 2015 to cash the checks for their share of the $4 million debt collection scam settlements.

According to the FTC, the Southern California debt collection agency, Asset Capital, operates under dozens of fake names and employs deceptive and abusive businesses practices to collect on consumers’ credit card debt, which constitute FTC Act and Fair Debt Collection Practices Act violations.

The FTC has charged Asset Capital with claims that the company posed as process servers, made false threats to consumers, including threatening lawsuits, seizure of property, arrest, and wage garnishment. Additionally, Asset Capital reportedly disclosed consumers’ debts to their employees, colleagues, and family members.

In addition to paying a total of $4 million, Asset Capital has also agreed to turn over their personal assets, given up their claim to any business assets, and are furthermore banned from the debt collection industry as a whole. According Jessica Rich, the Director of the FTC’s Bureau of Consumer Protection, “Consumers shouldn’t be subjected to threats and intimidation. We’re pleased that victims of this scheme will be getting money back from the defendants.”

These FTC debt collection scam settlements stem from a lawsuit against Asset Capital by the FTC that dates back to 2013. Back in June of that year, the federal agency requested that a Los Angeles federal court halt Asset Capital’s operations, freeze the company’s assets, and finally appointed a receiver to take charge of the debt collection agency’s business affairs.

The FTC debt collection scam settlements resolve court imposed judgments on Asset Capital that originally totaled to $90.5 million. Asset Capital employees Thai Han, Jim Tran Phelps, Keith Hua, and James Novella will have to surrender their personal assets and will subsequently be suspended from the business. The profits from these surrendered assets and the frozen corporate funds will go toward the $4 million FTC debt collection scam settlement fund to benefit consumers who were allegedly taken advantage by Asset Capital.

In addition to the monetary judgments placed by the court on Asset Capital and those involved in the debt collection scheme, as well as the ban no the company from collecting on debts, this FTC debt collection scam settlement forbids Asset Capital from misrepresenting any information in relation to selling or promoting debt relief, credit repair, lending services, and mortgage assistance.

Consumers should expect to receive their FTC settlement check in their mail soon. The FTC urges consumers who have questions about the case to contact the hotline at 1-855-312-3324.

The Asset Capital Debt Collection Scam Lawsuit is Federal Trade Commission, Plaintiff v. Asset & Capital Management Group, et al., Case No. CV13-5267, in the U.S. District Court for the Central District of California.