How to recognize a debt collection scam

Be wary of debt collectors who ask for immediate payment


The FDCPA requires debt collectors to follow certain rules in their dealings with debtors and there are some tip-offs that a debt collector is scamming you.


The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

It seems debt collection scams have been on the rise in these trying times. People hunkering down at home in the pandemic, many behind on their debt payments with their finances in disarray, have become easy targets for bogus debt collection attempts.

No wonder the Federal Trade Commission initiated a sweep called “operation corrupt collector” last September, together with several state authorities, targeting debt collectors trying to collect on debt they cannot legally collect on or that a consumer does not owe.

The Consumer Financial Protection Bureau, U.S. Department of Justice and the U.S. Postal Inspection Service were also involved in the operation. And several state attorneys general have put out warnings about debt collection scams.

See related: Feds crack down on abusive debt collection practices

Read more from our credit card experts.

Ask Poonkulali a question.

What is a debt collection scam?

If you ever hear from a debt collector about a credit card debt you don’t recognize, be wary. It could be phantom debt that does not really exist or debt that you’ve already paid off or got discharged in bankruptcy.

The caller could be pulling a scam and representing themselves as a debt collector. Be suspicious if they don’t give you their mailing address or phone number. They may also use scare tactics, threatening legal action against you or making noises about getting you arrested.

One way to verify if you really owe the debt is to get validation information for the debt. The Fair Debt Collection Practices Act requires debt collectors to provide such information about the debt, either on a phone call or in writing, within five days of their first contacting you. This includes the debt amount, who the current creditor is and how you can get the name of the original lender you borrowed from.

You could also check your credit report (which the credit bureaus are providing for free weekly through April 2022) to find out if the debt in question is listed on it.

See related: 10 signs you’re talking to a scammer

How to recognize a debt collection scam

The FDCPA lays out rules for how debt collectors should behave in their dealings with consumers. Some prohibited behaviors that fake debt collectors could engage in that should raise red flags include:

  • Harassing you with constant phone calls or obscene language.
  • Threatening violence or legal action against you.
  • Falsely claiming they’re calling from the government or that they could put you in jail.
  • Saying they could garnish your salary or seize your property when they don’t have the legal authority to do this.
  • Giving you a fake company name, or otherwise misrepresenting themselves.

The Michigan attorney general advises in an online posting that in addition to these outlawed behaviors, fake debt collectors may call you constantly at home, work or on your cell phone but decline to give you their phone number, mailing address or real name. They could even represent themselves as working for fake debt collection agencies.

These imposters could well have a lot of information about you, such as your Social Security number, the name of your bank and your date of birth. These fake debt collectors could say they are calling from a government agency, a court, a law firm or the police.

Another tip-off about a debt collection scam is the fake debt collector threatening you with arrest if you don’t immediately make good on your debt. They could ask you to pay them using methods that can’t be traced back to them, such as a gift card.

See related: CFPB finalizes fair debt collection update proposal

How to deal with a debt collection scam

Once you suspect that you are being scammed, you can confirm your suspicion and report the matter to the appropriate authorities. The FTC advises that you:

  • Get the name of the debt collector and the collection agency, as well as the latter’s address and phone number.
  • Do your own snooping and check with the original lender cited in the matter whether you really owe the debt. You could find out if they sold the debt or hired a debt collector to pursue the debt, and if the agency that contacted you represents them.
  • If you think you don’t owe the debt, or even if you just owe some of it, dispute the debt with the debt collector either online or by mail. Do this even if they did validate the debt.

You could even put in a preemptive fraud alert with the credit bureaus in case there are any further fallouts from the matter.

Finally, you can report the matter to the FTC, the CFPB, the U.S. Commerce Department or your state attorney general.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

Credit Card Rate Report
Cash Back

Questions or comments?

Contact us

Editorial corrections policies

Learn more