WASHINGTON—The Federal Trade Commission and the New York Attorney General’s Office have sued a New York-based debt collection operation for tricking people into
agreeing to pay more money than what they allegedly owed, according to defendants’ own business records.
A federal court temporarily halted the operation’s illegal activity and froze its assets at the request of the FTC and New York AG, the FTC said.
According to the complaint, the defendants’ employees often completed forms that showed they demanded more money than consumers allegedly owed, also known as “overbiffing” in the debt collection industry. In many cases, according to the complaint, consumers agreed to pay more than what they allegedly owed.
The complaint also alleges that employees pretended to work for law enforcement agencies and threatened consumers with arrest. Other collectors falsely claimed to work on behalf of attorneys and told consumers they would face lawsuits if they did not make a payment on an alleged debt.
The defendants in the case are six corporations and one individual, Robert Heidenreich, who controls the operation. The corporate defendants are Campbell Capital LLC; Kahl, Heidenreich, and Nemmer LLC; Urban, Heidenreich, Melendez, and Associates, LLC; J & V Receivables LLC; Rich Financial LLC; and BCH & Associates Ltd. The FTC and NY AG allege they violated the FTC Act, the Fair Debt Collection Practices Act, and similar New York State laws, the FTC said.