Debt collector to pay $700,000 in settlement with FTC

On February 14, 2017, the FTC issued a press release announcing that it had reached a settlement agreement with GC Services Limited Partnership to resolve allegations that GC used “unlawful tactics to collect on federal student loans and other debts.” Under the settlement agreement, GC will pay a $700,000 civil money penalty.

GC is a third-party debt collector that focuses on collection of federal student loans and other types of debt. GC is headquartered in Houston, Texas.

The FTC’s complaint contained the following allegations:

  • GC’s collectors left phone messages on voicemails, answering machines and other messaging services that resulted in the unlawful disclosure of purported debts to third parties without the borrower’s permission.
  • GC’s collectors also called consumers multiple times after being told that the person who answered did not owe the debt, that GC had called the wrong person, or that the person that GC was attempting to contact could not be reached at that number.
  • GC’s collectors failed to take necessary steps to ensure that it ceased contacting individuals who told GC they did not owe the debt. GC’s collectors misrepresented that it would remove such phone numbers from its call lists and/or database.
  • GC’s collectors call third parties more than once for the purposes of acquiring location information for consumers.

Under the stipulated order, GC is prohibited from violating the Fair Debt Collection Practices Act (FDCPA) and from engaging in future false, deceptive or misleading conduct in connection with collection activity. In addition, GC must pay a civil money penalty in the amount of $700,000.

Tags: Debt Collection, DOJ, FDCPA, FTC

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