FTC guns for Georgia debt collector

Sexual harassment, verbal abuse and threats of arrest by cop imposters were the calling cards of a network of debt collection company that got the boot in New York in 2009, authorities said. Terrified consumers even agreed to pay debts they didn’t owe, the attorney general there said when he sued to shut down the companies.

Apparently undeterred, one of the accused men moved to Georgia and got back in the debt collection business with a new group of companies but the same old bag of tricks, federal officials say.

Debt collectors working for the companies, managed by ex-New Yorker Omar Smith, impersonated investigators and law enforcement, threatening to arrest or sue consumers if they didn’t pay, the Federal Trade Commission alleged in a lawsuit here.

Harassing callsTo intimidate consumers, collectors would also use profane language, call at all hours and contact employers and co-workers about the debt, the FTC claims. To avoid detection, the companies used a variety of corporate names and locations, the agency said.

Names included AFS Legal Services, but the companies were set up as National Payment Processing and National Client Services, with offices in Tucker, Hapeville, Conyers and Marietta, court documents state. Omar Smith is listed as owner, manager, CEO, CFO and organizer of one of the companies and attorney-in-fact for the other, which is owned by Ernest Smith, the government says.

Debt collectionA federal judge last week blew the whistle on the company, prohibiting the pressure tactics, freezing assets and denying the Smiths or their companies access to any safe deposit box and telling them to account for all assets they may have outside the U.S.

FTC officials say the operation did $4 million in damages to consumers. Police in Rockdale, DeKalb, Gwinnett and Hapeville were involved in the investigation, the federal agency said.

New York, by the way, enacted new rules last year to crack down on abusive debt collectors. Read more about Georgia’s approach here.



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