A pair of individuals who were charged last year with operating an abusive debt collection scam have reached a proposed settlement with the Federal Trade Commission which will see them barred from the ARM industry for the rest of their lives, as well as imposing a judgment of more than $1.6 million, which represents the amount of “consumer harm” they caused, according to the FTC.
The individuals — Dion Barron and Charles R. Montgomery III — and the company they operated — Lombardo, Daniels & Moss — were accused of misleading consumers into thinking their debts were being placed with a law firm or an attorney for collection. As well, the defendants were accused of collecting or attempting to collect on debts that did not exist. The alleged actions undertaken by the defendants reads like a greatest hits list of what bad actors do when trying to scam individuals, including:
- Informing consumers they are delinquent on a payday loan or other debt, and stating that legal action will be taken
- Telling consumers they will be sued, have their wages garnished or bank accounts frozen
- Threatening arrest if the consumers did not pay the debt immediately
- Contacting consumers on their home, cell and work telephones “with the intent to intimidate and harass consumers into paying the alleged debts”
- Calling third parties such as a consumer’s employer and disclosing the purported debt
- Failing to provide a validation notice of the debt
Portions of the judgments against the defendants are being suspended pending the surrender of certain assets — mainly the funds in bank accounts they maintained. The amount of the portion of judgments that are being suspended was not stipulated in the orders against Barron or Montgomery.