4 Ways to Spot a Scamming Collections Agency

Have you ever seen the horror stories on the news of people giving their credit card information to a scammer and losing thousands of dollars?

Fake debt collection agencies may call you, demanding money immediately from a debt that may or may not be real, and then ride off into the sunset with your hard earned money and a mark still on your credit report.

We all like to think “well that could never be me”, but these fraudsters are becoming more elaborate with the ways that they are able to trick you into thinking that they are the real deal. From digging up old debts, to using fake agency names, scammers can come across as seeming legit. But by using these tips, you can better protect yourself and spot a fake agency from a mile away.

1. Verify The Debt

A popular strategy that these fake companies use is finding out what outstanding debts you have listed on your credit statement, and then acting as a collection agency to collect on it. They may use the name of the companies that you owe money too and act as if the debt is a lot more than it is.

In these cases, it’s best to ask for proof of the debt. A real collection agency should have copies of the contract or invoice readily available to confirm the exact amount and the obligation made. Be wary of those who can’t produce these documents when asked for them.

2. Contact Information

Many of these scammers will pressure you to make a payment with visa gift card on the phone the first time they contact you. Keep calm and get their contact information. If they aren’t willing to give you an email and phone number, odds are that it is a fake collector. 

With a way to trace them, they will no longer be able to live behind the veil of secrecy. Collectors should want you to reach back out to them and be very transparent about the company they work for. People who have something to hide will typically act like they do, so don’t be afraid to take some time and try to collect this information.

3. Threats of Jail Time

Some of these impersonators might use threats as a way to pressure you into making a payment as fast as possible. By creating this sense of urgency, they are trying to catch you off balance and have you make a decision that you normally wouldn’t. 

To be clear, there are very few situations where you could go to jail for owing money. Only in the cases of tax evasion and child support evasion will you be facing life behind the steel bars. On a typical commercial debt, you may face a lawsuit to obtain a judgment, but that is usually the extent of legal action. Although you may have your wages garnished, or become legally liable for completing this payment, there is not often a real threat of jail time.

4. Limited Payment Options

As a collection agency, we offer our debtors a variety of ways to pay. We do this because we know some debtors have different needs and we want to be as helpful as possible. When a “collector” tries to pigeonhole you into using a singular payment method that may not be secure (i.e. money orders & prepaid cards), these should be immediate red flags.

Any money sent to an agency should be traceable in some fashion. A bank wire, ACH, checks, and online payment portals are all popular payment methods that will allow you to find exactly where your money is going. is going. This will keep the collection agency accountable, and will also allow you to keep records to make sure that the debt is taken off your credit report.

As the world continues to evolve, scammers and criminals continue to get smarter. Information we once thought to be private and secure is getting leaked every day. Make sure you are staying aware of these debt collection scams and are actively protecting yourself. 

If you get these scam calls, your best practice is going to be to just ignore them. Once they realize that you’re wise on their tricks, they will eventually back off. If not, you can always report these crimes to the Federal Trade Commission (FTC) at 1-877-382-4357

If you need debt recovery solutions, get in contact with Kearns Brinen & Monaghan today. Certified by both the IACC & CLLA, KBM provides the premier commercial debt collection services both domestically and internationally. Providing the best return on the dollar, KBM supplies the resources and solutions to help bolster your bottom line.