Debt Collector or Scammer: How to Tell the Difference?

Learn the red flags for debt collector scams.

Updated by , Attorney (University of Denver Sturm College of Law)

Scammers sometimes pose as debt collectors and collection agencies and try to get consumers to pay them. These scam artists often use abusive and harassing tactics to frighten you into providing bank and other personal information while you falsely believe that you're paying real debts.

It can be difficult to distinguish between a legitimate collection agency and a debt collector scam. So, be alert for red flags indicating the collection call you've received probably isn't from a legitimate collection agency.

Pay attention to these warning signs if you get a call from an alleged debt collector to avoid becoming the next victim.

How the Fake Debt Collection Scam Works

The scam is straightforward. Scammers call consumers to collect debts, posing as real collection agencies.

Example. A scammer informs you that she is collecting an American Express debt. You might owe money to American Express, so you believe the caller works for them. The scam is that the caller has no relationship with American Express, and whatever money you fork over isn't going to that company. Instead, the money goes into the scammer's pocket and any other funds the scammer can access with the financial information you provide.

How Do You Know If a Call Is From a Scammer Debt Collector?

Here are some tips to help you determine whether you're talking to a real collection agency on the phone or a scammer.

The Caller Is Abnormally Harassing and Abusive

Although legitimate collection agencies have been known to use illegal and abusive collection tactics, scammers will often use over-the-top, aggressive, blatant threats. They will tell you that you're being served with a lawsuit immediately. Or they might say that they've contacted the police or that you might be arrested. These are, of course, false threats.

The Caller Demands Payment "Today"

A scammer will often insist on payment "today." The scammer might tell you that you'll have to pay a penalty if you don't come up with the money immediately, threaten to file a lawsuit by the end of the day or make another threat.

Of course, collection agencies also want to be paid immediately. But rarely will they threaten immediate punishment or similar action if you don't make a payment by the end of the day.

The Caller Doesn't Accept Various Forms of Payment

Most collection agencies will accept payment through the mail, phone, website, or debit card. They want your money no matter how you get it to them. A scammer usually insists on payment in a single way, like an instant bank transfer.

The Caller Refuses to Give a Physical Address or Name

If the collector can't give you an actual mailing address or even the full name of the company you owe money to, that's a sure sign of a scam. Any legitimate collection agency will readily give you this information.

The Caller Refers You Back to the Original Creditor for Information

A real collection agency knows something about your debt or will contact the original creditor for information it doesn't have, so a real collection agency won't tell you to contact the original creditor.

If the collector can't provide you with basic information about the debt, like the date of default, amount of principal and interest, account number, whose name the debt is in, or other information, or it refers you to the original creditor for such information, you're likely talking to a scammer.

Someone Answers the Phone Immediately When You Call

Real collection agencies have complex phone systems or receptionists who route your call to a collection agent. If you call and the collector answers the phone directly, they're likely using a cell phone, a telltale sign of a scammer.

You Keep Dealing With the Same Person

Legitimate agencies have multiple collection agents. It doesn't matter which one you deal with. If you keep talking to "Frank Jones" every time you call, it's a sign that you might be speaking to a scammer.

The "Collector" Contacts You At Unusual Times

Under federal law, a debt collector can't contact you at any "unusual time" or at a time that it knows, or should know, is inconvenient for you. Unless you tell the collector otherwise, the FDCPA says that a collector can't call before 8:00 a.m. or after 9:00 p.m.

While a legitimate debt collector might break the law, constant calls that are inconvenient are an indication of a scammer.

What to Do If You Think You're Being Scammed

The best thing you can do is not to pay anything or give away any of your personal information until you do further research to find out if the caller is legitimate. Here's how.

Run an Internet Search for the Caller's Phone Number

If it's a scammer, your search will likely reveal others with similar problems. Some websites are devoted to discussions about collectors. If you input the number the collector is calling from, you might find others who have been threatened in the same ways that you have. Be aware that the number might be spoofed. So, call the original creditor too.

You can also ask for a callback number. Then, research that number.

Call the Original Creditor

The original creditor should be able to tell you which company it hired to collect your debt or which company purchased it, along with the contact information for that company.

Verify the Debt Before Making a Payment

Again, verify you actually owe a debt before paying.

You can also check your credit report to see if you owe a particular debt. You can get free weekly reports online at annualcreditreport.com, a service the credit reporting agencies started during the COVID-19 pandemic. However, not every creditor or collector reports to the credit reporting agencies.

What If the Caller Is a Scammer?

If you're convinced that the caller is, in fact, not a legitimate collection agency, the best thing you can do is ignore the calls. Scammers want quick turnaround and easy prey. If you don't respond, they'll move on to someone who will.

However, once scammers believe that you're frightened or convinced that you owe the debt to them, and once they know you'll answer the phone when they call, they see you as a target and won't let up.

What If You've Already Paid an Illegitimate Debt Collector?

If you've already paid a scammer posing as a debt collector, you must act quickly to minimize your financial losses and protect your personal information. First, keep a record of all communications you've had with the scammer, including any phone calls, emails, or written correspondence and copies of any payment receipts or transaction records. You'll need this information when reporting the scam. Report the scam to the Federal Trade Commission (877-FTC-HELP), local law enforcement, and your state Attorney General's office.

Also, contact your bank immediately to see if you can recover the money you paid the scammer. Your financial institution might be able to reverse the payment, stop it, or block future payments to the scammer.

Finally, take additional security measures to protect your personal and financial information, such as changing your passwords and monitoring your accounts closely to look for any unusual or unauthorized transactions.

Getting Help From a Lawyer

If you're receiving harassing calls from a legitimate debt collector, consider talking to an attorney to determine what you should do in your particular circumstances.

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