Georgia Reaches $4 Million Settlement With Over-Aggressive Debt Collector

By Jonathan Shapiro

Atlanta, GA –
Georgia has reached a $4 million settlement with an overly aggressive debt collection company. The state hopes it will send a message.

Debt collection company Nelson, Hirsch & Associates had nearly 6000 consumer accounts, most of which consisted of zombie debt - a term for debt that has long been written off by the original creditors.

To collect, the state says the Fairburn-based company repeatedly used abusive practices made illegal by federal law.

The practices include: threats of imprisonment and arrest; failing to disclose themselves as a debt collection company; harassing people at work, making collection calls after 9pm, and calling some people up to 50 times a day.

"The main thing is you don't threaten people in terms of their debt," said Bill Cloud, a spokesman for Georgia's office of Consumer Protection. "You don't threaten them physically. You don't threaten them with arrest. You don't act like a law firm if you're not. These people were just doing everything in the book that was wrong."

Cloud says since 2008's financial meltdown, abuse by debt collectors has been one of the most frequent complaints his office receives.

"I think this settlement is a statement to the public, to other debt collectors, to anybody else breaking the law," said Cloud.

He says if consumers are in trouble with debt, they should call a reputable consumer credit counseling service and develop a do-able installment plan.