January 12, 2017 | Posted in:

Debt Collector or Scam Artist? 3 Red Flags to Pay Attention To

Identity thieves are always trying to be more and more creative to get you to innocently pass on your sensitive information. Proceed with caution if you are on the receiving end of phone calls such as this.

You buy a washing machine on credit and make the loan payments until the debt is paid off. Then you receive a call from someone claiming to be a debt collector for the appliance store. The caller alleges that you still owe a hefty balance on your loan. When you insist you’ve paid the loan in full, you’re bullied and harassed. The caller says if you don’t pay up, you’ll be charged additional interest and might even be thrown in jail.
Is the call legitimate? Or is this a scam? Three red flags can help you determine the answer.

  • Elusive responses. Ask for specific information about the alleged debt. Though legitimate collectors can make mistakes or call the wrong party, the caller should have ready access to details backing up the claim. For example, ask the caller to provide the debt amount, and the lender’s name, address, and phone number. If the caller can’t produce evidence that ties you to a specific debt, you’re likely being scammed.
  • Demands for financial or personal information. Some fraudsters use debt collection as a phishing tool. They’re trying to get enough information to open a credit card account or take out a loan in your name. Never give out personal or confidential data such as bank account numbers to someone you don’t know.
  • High pressure or threats. Under the Fair Debt Collection Practices Act, debt collectors may not threaten, abuse, or harass you, your spouse, or any other third party. They may not continue to contact you after you’ve made a written request for them to stop. If you’re feeling threatened or bullied, hang up and call your state Attorney General’s office or local law enforcement.

Still not sure whether the call is legitimate? Plug the collection agency’s name and address into an internet search engine to verify that the company exists. Contact the Better Business Bureau to learn if complaints have been lodged against the agency. Pull your credit report at to confirm any outstanding debts. Call the store to verify that you still owe money. If, after researching thoroughly, you don’t recognize the debt, don’t pay.
If you need help managing your debt, give us a call.

How to spot scams & cons


If it sounds too good…
According to the FBI, there are over 14,000 scam artists at work on any given day. Perhaps the information presented here will help you avoid becoming a victim. If you have questions, please call us. Remember, if it sounds too good to be true, it may well be a scam.

© MC 2017 | “Fraud Alert” is published monthly to provide useful information about scams and cons. Return to this site every month for helpful suggestions on how to avoid fraud. If you would like to be on our mailing list to receive other financial, tax, or business information from time to time, please click here.

The information contained in this site is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance.


Empowering business owners and individuals in South Jersey and Philadelphia to feel confident through proactive accounting and advisory solutions.

About Us →    Our Solutions →    Follow @AlloyCPAs on Twitter →