Debt Collection Scam Affects Texas Business

When a Dallas-area contractor received a call from a debt collection agency that offered to help him recover money owed on a contract, he considered it a dream come true. However, after dealing with the California company calling itself Financial Adjustment Solutions, the dream quickly became a nightmare. Chris Welch, owner of Welch Air Conditioning, became the latest Texas victim of an alleged debt collection scam that promises to recover unpaid debt in exchange for a “processing fee”.

Business Loses Over $5,200 in Debt Collection Scam

Financial Adjustment Solutions promised Welch that it would help him recover $40,000 owed him by a builder on an air conditioning project. The company requested that Welch send them $5,262 to retain their services. Welch quickly suspected that the upfront payment was part of a possible debt collection scam when the company received its fee but did not pursue collection efforts against the builder.

How the Debt Collection Scam Worked

According to Welch, the perpetrators of the alleged debt collection scam cold-called him. The representative offered to pursue the debt against the builder in exchange for a percentage of the amount owed. The caller also told Welch how to send the upfront payment that would start the debt collection process. When Welch’s payment cleared, the company stopped returning his phone calls and never sent him any of the debt they promised to collect.

Victims of Debt Collection Scam Come Forward

Welch and his company weren’t the only ones affected by this debt collection scam. Nathan Lee, owner of an Illinois funeral home, was also contacted by Financial Adjustment Solutions. The company promised Lee that it would collect a debt for his firm if he paid $16,000 in advance. After more than a year, Lee also never received any of the debt that FAS promised to collect for him.

Owner Blames Employees for Debt Collection Scams

Lee contacted a St. Louis-area television station about the debt collection scam. The station’s investigative news team tracked down Andre Green, the owner of FAS, to determine how the company conducted its operations. Green cited his “understaffed” office and “reckless” workers as the main reason why it had not collected any debts. He also noted that FAS was in “financial trouble” and was unable to return the money to its disgruntled customers.

Debt Collection Scam Closes Its Doors

Shortly after the television station released its report, the telephone numbers for FAS were disconnected and its website was taken down. FAS also received several complaints from consumer advocacy groups. The Dallas office of the Better Business Bureau gave FAS a grade of “F” for its lack of action on customer requests. The company has also reportedly been cited for ignoring the federal “Do Not Call” list in its pursuit of new clients. While no reports have surfaced yet of the return of this debt collection scam, business owners should be wary of sending any upfront fees to collection agencies.

Source: KTVT-TV

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