Debt collection fraud is on the increase, as are the consumer complaints about dubious collection practices. Someone who receives a collection letter with a request for payment often feels insecure and does not exactly know how to react. This uncertainty is exploited by debt collection scammers. The contents of the payment claim are usually contracts that have been foisted over the phone, online subscription scams or gambling games advertisements. Debt collection fraud usually does not end with a letter. Further dunning letters follow, the threat of a court case and constantly increasing dunning fees along with subsequent costs. Trading with people's fear and debt collection fraud are successful because some of the recipients immediately pay for shame. In most cases, it is dubious collection agencies, questionable law firms or fraudsters operating domestically or abroad who are behind debt collection fraud.
A collection agency takes action when a creditor appoints them to collect a usually undisputed receivable on his behalf. Another option is that the collection agency, based on a contract with the creditor, collects enforceable and undisputed claims as a trustee, . In relation to third parties, the collection agency then becomes the owner of the receivable; this also applies to the transfer of the receivable if the debt has been purchased. A legitimate collection agency, which operates very differently to debt collection fraud, has a stringent approach. Usually the first step is to analyse the financial circumstances of the debtor via an credit agency, to get an impression of his solvency. If the result is positive, the first collection letter is sent. In this, the debtor is requested to settle the open receivable within a certain time period, plus default interest, collection costs, dunning costs and other expenses. This first payment request to a private person entails mandatory information- and disclosure obligations (§ 11a Legal Services Act). Different from debt collection fraud, the origin of the receivable is named here. The debtor is then notified of the further strategy, because there is no standardised collection procedure. A legitimate collection agency will, unlike in debt collection fraud, attempt for the debtor to settle out-of-court.
The receiver should first verify who is collecting the receivable, if the receivable exists in the first place, and if it is justified. This is a principle that applies to any collection letter and should not only apply to suspected debt collection fraud. Furthermore, the recipient should take a close look at the amount of fees, surcharges and interest charged, as excessive levies are usually an indication of debt collection fraud. Even if the collection letter is a debt collection scam and gives notice of a bailiff's visit, distraint of wages or accounts, or threatens with legal action, the addressee should remain calm. For the valid appointment of a bailiff, there must be a legal title against the debtor. However, in most cases an enforcement order is obtained by taking legal action or via legal dunning. This also applies to the threat of wage and account distraint. Here, the existence of an enforcement order is also an essential requirement.
If the receivable is unfounded, it is important not to sign anything, such as a request for instalment payments. This is also debt collection fraud, because anyone who signs the instalment payment agreement without further clarification is acknowledging the wrongly claimed receivable. The same applies to the phone number provided, which prolongs the debt collection scam because it is often an expensive 0900 number. If the debt collection fraud concerns a contract that has been foisted on someone, it should be challenged. Anyone who has fallen victim to debt collection fraud may seek assistance at consumer advice centres of the Bundesvereinigung gegen unlauteres Inkasso e.V. [Federal Association against unfair debt collection]. and the Bundesverband Deutscher Inkasso-Unternehmen e.V. (BDIU). Its credo is to consistently strive for high quality standards among its member companies.