Regulators crack down on aggressive, dubious debt collectors

FILE- In this Aug. 6, 2020 file photo, New York State Attorney General Letitia James takes a question at a news conference in New York. During a Tuesday, Sept. 29 media conference call on an initiative, dubbed "Operation Corrupt Collector," James offered frank advice to older people who are often seen as easy marks for dubious debt collectors. "Senior citizens, as I always say, they've earned the right to hang up and to be rude," James said. "Most seniors are not rude, but when it comes to individuals engaging in illegal conduct, they should hang up and report the collector to the FTC immediately." (AP Photo/Kathy Willens, File)

NEW YORK (AP) - Those mysterious debt collectors who call insisting you'll be in legal peril if you don't pay them big bucks are in hot water themselves, accused in a nationwide crackdown of harassing and threatening consumers, often about debts that don't actually exist.

The Federal Trade Commission on Tuesday highlighted enforcement actions filed in recent months against two South Carolina-based debt collection firms accused of bilking people out of a combined $17.2 million, as well as settlements with three other firms accused of using pressure tactics and other shady practices.

Ironically, the firms that agreed to financial settlements were unable to pay the full amounts.

While consumer complaints about debt collectors have dropped slightly since the start of the coronavirus pandemic in March, the commission's consumer protection chief, Andrew Smith, anticipates that will change as collectors increasingly target people experiencing crisis-related financial hardship.

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