Argh! Capital One Brings the Hassle

Today someone called a friend of mine, demanding that his Capital One balance be paid in full by Monday. My friend was upset not only by the threatening tone of the call, but also because he was in good standing on his payment plan with the company. He wondered if he was being scammed.

Turns out it’s not so easy to figure out. Whether or not the threats are legal depends on the identity of the caller. If Capital One has charged off his debt to a third party, that party may not have recourse in court, and my friend may be able to report this party as engaging in illegal activity under the Fair Debt Collection Practices Act (FDCPA).

However, if Capital One is using an in-house agency or employees, it is not a violation of that act. (Because under the law, they’re not recognized as debt collectors. Nice.)

There are reports all over the Internet from people being sued by or otherwise in collections hell with Capital One, and at least one attorney general is paying attention — Capital One Bank, a subsidiary of Capital One Financial Corp., has just been served in West Virginia for fraudulent and deceptive collections practices.

What should you do in a situation like this?

Be cool, baby. Say little, admit nothing.
Request their identity, contact information and address.
Get their demands in writing.
Contact an attorney. Check out the National Association of Consumer Advocates.
Also see Caveat Emptor, a great Twin Cities-based consumer rights blog, and Debt Collection Answers, another lawyer-based blog.
Keep documentation. (My friend is going to be recording all of this debt collector’s calls.)

UPDATE: If you settle for less than you owe, plan to pay taxes on any forgiven amount of more than $600.

My friend promises updates, so stay tuned. We’ll be rooting for you!

UPDATE: He settled with Capital One in order not to be sued. He wasn’t thrilled with the terms of the deal.

As for Capital One, those pirates always did give me the creeps.