How to Identify Debt Collection Scams

It doesn’t matter whether you’ve spent a fortune lately or $0: you need to be vigilant to debt collection scams. Modern telecommunications do wondrous things every day by connecting people worldwide instantly, sometimes even face to face.

One regrettable drawback of this technology is that scammers use phones and emails to try to dupe people into paying money they don’t really owe by claiming to be a legitimate institution in need of repayment. As a result, people who may actually owe money might be targeted by such a scam and feel less inclined to recognize its falsity.

Scammers are happy to take advantage of people’s insecurities over money owed, and they hope you are flushed with fear when you encounter their scam. On the flip side, it’s also important to know when a debt collector is legitimate, as people must repay the money they owe before their debt grows and the problems increase.

Let’s look closer at a few of the most common scams, so you can confidently sidestep fraud and know when the need to make a payment is genuine.

CRA Tax Collector Scam

Have you ever been called by someone claiming to work for Canada Revenue Agency (CRA), demanding you repay money you owe in taxes via credit or debit? Hopefully not, because this is a scam!

The CRA has very specific reasons why they call people, and this is not one of the reasons. One telltale sign is the person on the phone is aggressive and doesn’t let you respond or get a question in. No matter their demeanour or attitude on the other end, the CRA never asks for people’s credit card or debit card numbers over the phone.

Feel free to hang up instantly, and don’t give them any personal information. To see if you owe tax debt, check the CRA website. They have information about payment options too. The more information you have about spotting ethical debt collectors, the less likely you are to succumb to a debt collection scam.

Collection Agency Scams

Scammers often pretend to represent one of the two major credit bureaus, Equifax or TransUnion. However, not only do these credit bureaus never collect repayments over the phone, they never collect repayments at all!

TransUnion and Equifax function for a few reasons, like providing consumer credit monitoring and identity theft protection. Even if you owed money, they might track the money owed, but you wouldn’t pay it to them. In other words, they’ll never ask you for money.

If someone calls you demanding repayments claiming to be a collection agency, you know it’s a scam. AR Summit is a consumer debt collection agency that has specialized in debt collection for nearly 30 years, and we never use robocalls, threats, or other aggressive tactics. 

We take pride in our PHD approach, which stands for “preserve human dignity,” and in our success rate, which is nearly double the industry standard. It’s essential to recoup money owed, but that doesn’t mean people need to be treated rudely or aggressively.

AR Summit offers specialized collection services that go above and beyond what you expect, like a skip-tracing department run by a licensed private investigator and a perfect A+ rating from the Better Business Bureau.

If you get a call from someone claiming to work for a collection agency demanding payment, hang up.

Fake Government Official Scam

Sometimes the person on the other end of the phone impersonates a government agency and threatens jail time unless you repay them soon. However, the only government agency that collects money from people is the CRA, and they’ll never call you in this manner asking for payment or personal information.

Feel free to hang up immediately, and never share any sensitive information. If you want, ask what agency they work for, along with the person’s name and position. That way, you’ll have more information to relay to a consumer protection agency. 

Phishing Scams

Phishing scams can occur via email or over the phone, so it’s important to understand how they work. The idea is simple. Someone pretends to be a legitimate institution in an attempt to tease out of you sensitive information that can compromise your identity, like a social insurance number.

They might ask you to complete your profile, or they need to double-check and verify their records. However, you must hang up and never give them any information at all!

AR Summit has many effective debt collection strategies, and none involve asking for people’s SIN numbers over the phone or email. It’s safe to say that you should never give this information out, no matter how legitimate the emails look or the voice sounds over the phone.

When leading debt collection professionals like AR Summit contact debtors like vendors or customers, we make it a point not to alienate or irritate them because business depends on smooth relationships and sturdy bridges.

Signs of a Scam

In general, there are a few tells that scammers have when trying to dupe all types of debtors or people who don’t happen to owe money. The person on the phone should identify the agency with which they work and their contact info, such as name, phone number, address, and website.

Sometimes scammers try to bombard you with scary-sounding information, hoping to overwhelm you before you catch onto the fact that they aren’t who they say they are. If the person you’re speaking to doesn’t let you get a word in edgewise, hang up.

Along those lines, debt collectors aren’t allowed to threaten you with jail time, which is a common threat in scams. If the collection agency isn’t registered with the Better Business Bureau, that’s another sign of a scam.

Modern technology can do incredible things that people never imagined, even just years ago. However, it also opens up new pathways for scams. Keep the above debt collection scams in mind to keep fraud at bay.