Georgia ranks third in the nation for illegal practices by companies trying to collect debt — slightly behind number two, according to an analysis of government data.
The ranking came by toting up complaints about collection companies that deceive, harass or use otherwise questionable actions – including attempts to force payment of “zombie debts” that are not actually owed, according to RewardExpert, a web site and company devoted to finding credit card and travel deals for consumers.
The company sifted through data from the Consumer Finance Protection Bureau that logged complaints involving debt not owed by the customer: Some had already been paid, some had been discharged through bankruptcy, some involved identity theft.
“You’d expect zombies at your Halloween party, but not when it comes to your finances,” said Roman Shteyn, company co-founder and chief executive officer of RewardExpert.
The law prohibits collection companies from going after consumers when there is no valid debt.
Reports of illegal debt collection attempts jumped 66 percent during the first nine months of 2017 compared to the same period a year earlier, according to RewardExpert’s calculations using data from the Consumer Finance Protection Bureau.
A relatively small number of large debt collection companies accounted for the vast majority of complaints, according to RewardExpert.
The three debt collection agencies that had the most complaints, according to RewardExpert, were Encore Capital Group, Enhanced Recovery Company and Portfolio Recovery Associates.
Encore in 2105 was ordered to pay $42 million to repay customers, plus a $10 million penalty, and to stop collections on $125 million worth of debt, according to RewardExpert. The government said it had decieved consumers. Encore at the time issued a statement asserting that it disagreed with the government, but chose to settle the dispute.
In response to an inquiry by The Atlanta Journal-Contition, a company spokeswoman declined comment.
RewardExpert says it looked only at complaints categorized as being about illegal debt collection practices or debts that were not owed.
Since 2011, Georgia has had 42.41 complaints for every 100,000 residents, with the highest rate of complaints in metro Atlanta, RewardExpert found.
Delaware had the highest rate of complaints: 44.72 complaints for every 100,000 residents. Florida edged out Georgia, with 42.42 complaints per 100,000 people.
The report comes with American debt on the rise and Georgia high on the list of debt-ridden states.
The median credit card debt in Georgia is $2,770 — ninth highest in the nation, according to a study by WalletHub, a Washington, D.C.-based financial advice firm.
Highest was Alaska: $4,040.
Iowa’s credit card debt is lowest: a median of $2,206.
The $67.6 billion in credit card debt that we added in Q4 2017 is the highest quarterly accumulation in the last 30 years – 68% higher than the post-Great Recession average.