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Minnesotans Warned to Be on Alert for Fake Debt Collection Scams

Minnesota Commerce Commissioner Issues Warning about Calls and Emails Trying to Collect on ‘Phantom’ Unpaid Loans

10/5/2015 8:42:09 AM


SAINT PAUL – Minnesota Commerce Commissioner Mike Rothman is warning Minnesotans to be alert for fake debt collectors who call or email consumers and claim they owe money on payday loans they took out at some point in the past. In fact, they are “phantom” debts that don’t really exist.

The Minnesota Commerce Department has recently heard from Minnesotans with complaints about receiving phone calls and email messages that appear to be from someone affiliated with Advance America Cash Advance or Cash Advance Inc.

This is a real company.  Although it is licensed in other states to offer short-term consumer loans, it does not do business in Minnesota.  The company has certified that it is not making the debt collection calls or sending the emails.

In the scam, consumers are receiving phone calls or email messages insisting that they are responsible for debt from old payday loans.  The email often includes an attached document that looks official.  The scammer may also have personal information about the consumer, such as Social Security number, date of birth and a bank account number.  This information may have been stolen or purchased.  

The scammer will often resort to threats and intimidation to pressure the consumer to send money immediately.

The Minnesota Commerce Department and agencies in other states are currently working to identify and track down the individuals responsible for the fraudulent calls and emails.

Rothman offered several tips to help Minnesotans protect themselves from being victimized by fake debt collectors:

  • Be suspicious of anyone who asks you to wire money or load a rechargeable money card as a way to pay a debt.  There is no legitimate reason for someone to ask you to send money that way.

  • Ask the caller for his or her name, company, street address and phone number.  If the caller refuses, the call is not legitimate.

  • Research and verify any contact information given to you. For example, if you are told to go to a specific website, it could be fake.  Instead of going directly to the website, search for it on Google and see if it is legitimate. 

  • Do not reply to emails from debt collectors.  A legitimate debt collection business would not contact you in that manner.

  • Ask for written proof of the debt that is mailed to you.  Tell the caller that you won’t do anything until you receive a written “validation notice,” as required by federal law.  The notice must include the amount of the debt, the name of the creditor and information about the consumer’s rights under the Fair Debt Collection Practices Act.

  • Do not provide or confirm any Social Security, bank, credit card or other personal information.  Fake debt collectors are also in the identity theft business.

  • Report a fraudulent call or email by filing a complaint with the Federal Trade Commission at www.ftc.gov or 877-382-4357.

  • You should also contact the Minnesota Commerce Department’s Consumer Services Center by emailing consumer.protection@state.mn.us or by calling 651-539-1600 or 800-657-3602 (outside Twin Cities metro area).

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