Student loan collector GC Services settled a lawsuit that alleged it engaged in unfair and unlawful debt collection.
The lawsuit alleges that GC Services repeatedly contacted third parties about someone else’s debt and even continued to call after promising to stop calling. In addition, the lawsuit alleges that GC Services left improper voicemails for consumers that resulted in a consumer’s debt being revealed to other people.
GC Services and the Federal Trade Commission have agreed that GC Services will pay a $700,00 civil penalty as part of a resolution of the lawsuit. This is the second time this year that a major student loan collector has been in the news for debt collection of student loans.
GC Services Collects Lots of Debts
According to the lawsuit, GC Services serviced more than 2 million accounts in 2014. That resulted in approximately $1.2 billion dollars in collected funds, resulting in revenues of approximately $133 million dollars.
The lawsuit also states that GC Services has 7,600 employees, and in 2014, approximately 1,400 of them were engaged in collection work.
GC Services Allegedly Called Third Parties Repeatedly
Under the Fair Debt Collection Practices Act (FDCPA), debt collectors are not allowed to call a third party more than once. In other words, if you receive a call about someone else’s debt, and tell a debt collector they have the wrong person, they are supposed to stop calling you.
The lawsuit alleges that GC Services did the opposite — it continued to call third parties after being informed they had the wrong person or that the person they are trying to reach is not at that particular number.
In fact, the lawsuit alleges that GC Services told some individuals they would stop calling, or would take steps to remove their phone number. However, the lawsuit alleges that GC Services continued to call third parties after promising they would stop.
GC Services Revealed Consumer Debts in Voicemails
The lawsuit also alleges that GC Services left voicemails that identified the consumer and indicated they were calling in connection with collection of a debt.
The problem, as noted in the lawsuit, is that some of these messages were left on voicemails that did not identify whether it was the consumer’s phone. In other words, the lawsuit alleges the voicemails may have been heard by someone other than the intended consumer — and therefore had the result of revealing the debt.
Revealing a Debt and Calling Third Parties Repeatedly are Illegal
A debt collector cannot reveal your debt to other people (with very limited exceptions – like your spouse). In addition, a debt collector cannot call a third party repeatedly unless that person requests additional calls.
If a debt collector tells someone else about your debt, a debt collector may have broken the law. And if you have received repeated phone calls about someone else’s debt, a debt collector may have broken the law.
The good news is that federal law not only protects the consumer that owes the debt, federal law protects anyone impacted by unfair or illegal debt collection activity.
If you have concerns or questions about debt collection calls that you have received, contact me today for a free case evaluation.