FTC Takes Court Action Against Scammy Debt Collector Network

The Federal Trade Commission (FTC) has taken decisive action to dismantle a nationwide fraudulent debt collection scheme through a court intervention, but the story doesn’t end there.

Quick Takes

The FTC has stopped a phantom debt collection operation and frozen its assets.
The scheme, run by Ryan and Mitchell Evans, posed as legitimate law firms and government agencies.
Victims were falsely accused of owing payday loan debts, experiencing threats of legal action.
A court issued a temporary restraining order against the fraudsters.

FTC Legal Action Stops Fraudulent Scheme

The Federal Trade Commission has successfully dismantled a phantom debt collection scheme named Blackrock Services and Blackstone Legal Group, halting its operations nationwide. The scheme involved sending fake debt notices and making harassing calls to consumers. The defendants used false identities, pretending to be law firms and government agencies, violating the FTC’s Rule on Impersonating Government and Businesses.

Through court support, the FTC froze the assets of Ryan and Mitchell Evans, the masterminds behind the fraudulent scheme. This action, supported by the U.S. District Court for the Central District of California, is a testament to the FTC’s readiness to protect consumers from deceitful activities. The defendants are accused of violating the Fair Debt Collection Practices Act by not properly identifying themselves as debt collectors.

Consumer Loss and Legal Measures

Consumers were told they owed money in connection with payday loans, receiving threats of wage garnishments and legal action. The scheme caused millions in losses, exploiting unsuspecting victims nationwide. In response, the FTC has filed a lawsuit seeking to permanently stop these illegal activities and provide restitution to the affected consumers.

A federal court issued a temporary restraining order to prevent further fraudulent actions while the lawsuit proceeds. The court intervention emphasized the importance of consumer vigilance and federal protection against such scams. Targeting fraudulent activities head-on reflects the FTC’s dedication to upholding its mission of consumer protection.

It's great news that the FTC is cracking down on student debt relief scams – but why is Google still running 80+ advertisements for a company that tricked consumers and pretended to be affiliated with the DOE? https://t.co/1DGZeyw3ws pic.twitter.com/AJAlqFaULX

— Tech Transparency Project (@TTP_updates) July 22, 2024

Implications for Consumers and the FTC’s Role

The FTC’s intervention serves as a reminder of the need for consumer caution regarding unexpected debts. It encourages consumers to report phantom debt collection practices. Additionally, the FTC’s actions recently resulted in over $5 million in refunds to consumers from a different debt relief scheme, known as ACRO services, showcasing the importance of regulatory oversight.

Consumers can report fraud and scams at ReportFraud.ftc.gov, reinforcing the importance of staying informed and vigilant. As fraud impacts many, federal agencies like the FTC remain indispensable in enforcing consumer protection laws and halting deceitful activities.