Better Business Bureau issues warning about phony debt collectors calling consumers nationwide claiming that they have defaulted on a payday loan and will be arrested if they don’t pay immediately. Claiming to be lawyers, the scammers say they are with the “Financial Accountability Association” or the “Federal Legislation of Unsecured Loans” and are equipped with a disconcerting amount of personal information about their potential victims.
Because the scammers have so much information about potential victims, BBB is concerned that this may be the result of a data breach. Thousands of people may have had their personal information compromised, and given the scammers’ tactics, it appears that those who have previously used payday loan services could be particularly at risk.
According to reports received by BBB and posted online, the scammers accuse the victim of defaulting on a payday loan and claim they are being sued. The phony debt collector threatens that, if the victim doesn’t pay as much as $1,000 immediately via wire or by providing bank account or credit card numbers, he or she will be arrested and extradited to California within the hour to stand trial. The scammers often have the victim’s Social Security, old bank account numbers or driver’s license numbers as well as home addresses, employer information and even the names of personal friends and professional references.
BBB offers the following advice to consumers if they receive a suspicious telephone call about an outstanding debt:
BBB further advises anyone who has received these calls to immediately post a Fraud Alert to your credit reports.
Here’s how to do that, from the FTC:
* Place a "Fraud Alert" on your credit reports, and review the reports carefully. The alert tells creditors to follow certain procedures before they open new accounts in your name or make changes to your existing accounts. The three nationwide consumer reporting companies have toll-free numbers for placing an initial 90-day fraud alert; a call to one company is sufficient:
* Equifax: 800-525-6285
* Experian: 888-EXPERIAN (397-3742)
* TransUnion: 800-680-7289
Placing a fraud alert entitles you to free copies of your credit reports. Look for inquiries from companies you haven't contacted, accounts you didn't open, and debts on your accounts that you can't explain.
According to complaints online, phone numbers that the scammers are calling from include: 949-468-5107, 415-200-0274, 415-200-0274, 213-784-5745, 408-715-1614 and many others.