CLEVELAND, Ohio -- Rogue debt collectors based in Cleveland and Atlanta were hit with a $11 million judgment for harassing people for payday loan debts they didn't owe or that the collections company didn't have the right to collect.
The defendants won't pay that amount because they can't, the Federal Trade Commission said, but they are banned from debt collection and debt sales.
The FTC announced the settlements Tuesday. The FTC alleged in a suit filed last year that Pinnacle Payment Services and its partner companies harassed people with robocalls and threatened them with arrest or legal action if they didn't pay up.
Some victims had visited loan-finding websites to inquire about payday loans. The FTC said the calls scared some into paying money they didn't owe.
More than 3,000 people complained about Pinnacle, which is now in the hands of a court-appointed receiver.
The FTC said that the judgments reflect the amount victims lost to bullying calls.
Pinnacle's partners included Premium Express Processing and Credit Source Plus, which had offices in Georgia and Ohio.
Here's how the judgments broke down:
DeMarra J. Massey of Cleveland, who controlled Premium, was ordered to pay $1.6 million.
Nichole C. Anderson of East Cleveland, who served as a manager of Credit Source, and Angela J. Triplett of Euclid, a Credit Source officer, were, along with several other individuals and the corporate defendants, hit with a shared $9.4 million judgment.
Massey and others named in the suit are banned from debt collection or debt sales and were ordered to destroy any consumer information in their possession.
Last week, the FTC and Consumer Financial Protection Bureau took enforcement actions against rogue lenders who deducted payday loan payments from the accounts of people who hadn't agreed to take out loans. The agencies said those companies used bank account information that victims had supplied through payday-loan search sites.
Lesson for consumers: Stay away from online sites that offer payday loans. You can't know who'll wind up getting your information or what they'll do with it.