Collections complaints filed with the state in 2014
Butler, 48
Champaign, 6
Clark, 39
Greene, 24
Miami, 13
Montgomery, 83
Warren, 21
Ohio, 2,099
Examples of complaints against debt collectors that work for governments
Xenia resident alleges collector calls all the time, trying to collect old, invalid traffic fines.
Dayton woman alleges collector calls relentlessly about debts that are not hers.
Grove City resident says debt collector keeps receiving collections calls for someone else, and company continues calling even though she has explained they have the wrong number.
New Concord resident says collector calls all the time, but refuses to provide information about the debt they want repaid, and the person they are looking for no longer lives at address.
If you are receiving calls and letters from third-party debt collectors, the Fair Debt Collection Practices Act states:
• A debt collector must send you a letter within five days after contacting you by phone, including how much you owe, who you owe it to, and how long you have to dispute the debt.
• You have 30 days from the date you are contacted by the debt collector to send the collector a letter disputing the debt and specifically requesting verification of the debt.
• Whether or not you owe the debt, you can tell debt collectors in writing not to contact you again. That does not eliminate the debt.
Debt collectors may not:
• Harass or use obscene words when talking to you
• Contact you before 8 a.m. or after 9 p.m.
• Contact you without identifying themselves
• Tell others about your debt
• Contact you at work if you or your employer disapproves
State and local government agencies use debt collectors to recover hundreds of millions of dollars each year in delinquent payments of all kinds - fees, taxes and fines.
But some consumers have objected to the practice and say some collectors harass and are deceptive. Consumers have also found that complaints against government collectors are often made to the very agency that is seeking to collect the debt.
The Ohio Attorney General’s office, for example, handles debt collection for all state agencies and institutions. It was the subject of dozens of collections complaints last year. Ironically, those complaints must be filed with the AG’s office itself. The office had more collections complaints against itself than nearly any other collector, according to data obtained by this newspaper.
Locally, debt collectors have recovered more than $9 million for the Dayton Municipal Court millions more for the city of Dayton, in unpaid tickets, fees and delinquent taxes. But collectors hired by Dayton have a few complaints against them from people claiming they pursue invalid debts and hound the wrong people.
State officials and collection firms said not all complaints are legitimate, and organizations that do large volumes of debt collection may upset some people while seeking repayment.
But, they say, government officials have a responsibility to taxpayers to try to collect money owed.
“Our recovery efforts mean taxpayer dollars do not have to go to make up those holes from unpaid fees, unpaid fines, unpaid taxes,” said Dan Tierney, spokesman with the attorney general.
The city of Dayton hired Capital Recovery Systems in 2010 to collect delinquent accounts for its finance department including accounts receivable, utility bills, emergency medical service charges and unpaid income taxes, city documents show.
The city later contracted a second time with the Columbus-based company for them to to pursue delinquent red light and speeding fines owed to the city.
Under the agreement with the city, the company receives about 20 to 30 percent of the money collected, depending on the age of the citation and whether court action was required.
The company also has collected misdemeanor criminal and traffic fines for Dayton Municipal Court since 2005. With these they are paid fees, charged to the debtors, because the court requires it be paid 100 percent of the fines collected.
Capital Recovery has collected more than $9 million in misdemeanor criminal and traffic fines for the municipal court, and it has obtained more than $2.7 million for the city of Dayton in unpaid parking, speeding and red light violations, said Craig Klein, the company’s president.
The company’s commission for the parking and traffic violations was more than $500,000, Klein said.
Capital Recovery serves about 200 government clients in Ohio, including about 160 courts.
“We’ve created a pricing structure where (the courts are) paying basically nothing, and we pass the costs onto the defendant,” Klein said.
Capital Recovery has been effective at getting the municipal court’s fines collected without costing the taxpayers, said Mark Owens, clerk of Dayton Municipal Court.
“We get paid before Capital Recovery gets paid,” he said.
Owens said debtors often must pay court fines and Capital Recovery’s fees. But, he said, the court provides people with payment options and plans. And, he notes, they should not allow their fines to go to collection in the first place.
The city of Dayton also contracts with the city of Cleveland’s Central Collection Agency to go after outstanding balances and unpaid taxes.
In the last six years, that agency has recovered $1.7 million for Dayton, charging $320,000 in fees, according to city records.
Public dollars at stake
Debt collection is vital to governments, because they depend on taxes, fines and fees to pay for essential services, state officials said.
In fiscal year 2014, the Ohio Attorney General collected a record $471 million for public sector entities, and payments help state hospitals, colleges and agencies avoid having to raise taxes or fees to balance their budgets, officials said.
Some of the attorney general’s most common collection actions are related to tax bills, unemployment compensation and workers’ compensation payments. Local governments also can contract with the state to handle debt collection activities instead of hiring of a private firm.
But some Ohio consumers and businesses have felt harassed or mistreated by government debt collectors.
There were more than 2,099 complaints about collection agencies filed last year with the attorney general’s consumer protection section including about 234 from Butler, Champaign, Clark, Greene, Miami, Montgomery and Warren counties. Complaints have declined statewide for four consecutive years and have dropped across the region.
But the attorney general received four complaints about Capital Recovery last year, and it has received about 33 complaints about the firm since 2011, according to state records.
Consumers complain
In January, Melody Love, 52, of Dayton, contacted the Ohio Attorney General about a letter she received in the mail from Capital Recovery.
The letter warned Love that the city of Dayton would tow her vehicle if she did not pay $220 in fines from automated red light cameras, she said.
Love said she never received a ticket from the city, and she refuses to pay the fees.
“I think Dayton is trying to rob the people, and the way they go about collections is very predatory,” she said.
Other consumers have complained that Capital Recovery hounded them about debts owed by other people whom they do not know.
Some consumers complained the company used robocalls - automated calls with recorded messages. Others accused the company of deceptive business practices or providing false information.
One resident said he made a payment to Capital Recovery for an unpaid utility bill, but the company refused to provide him with proof of payment or information about the debt he owed, state records show.
Last year, there were also more than 40 collections complaints filed against the Ohio Attorney General’s offic. Only one other supplier of services in the state had more collections complaints against it.
Consumers also lodged complaints against the Ohio Department of Taxation, the Internal Revenue Service and other government agencies.
Aletha Boggs, 61, of Dayton, said a Cincinnati law firm representing the attorney general has demanded she pay thousands of dollars in back state taxes, as well as interest charges.
Boggs said she has asked the firm and the attorney general to provide detailed information about how much she owes and how long she will need to make payments. But she said those requests have been ignored. She said she feels the state is not being transparent.
“All I want is pertinent information as to what the account is, what I owe and what the balance is,” she said.
The attorney general is the statutory debt collector for all state entities, though the office farms out some of its debt collections to third parties, Tierney said.
“It’s an important taxpayer protection that we collect this money,” he said.
He said the state is not subject to the same regulations as private debt collectors, but the office voluntarily complies with many of the consumer protection mandates.
“Just because it is a government debt, consumers should have the same protections when dealing with the attorney general’s office as they would with a private debt collector,” he said.
“Sometimes, the complaint number is a function of how much business you do in the state of Ohio,” Tierney said.
And collectors said the number of collections complaints is very small compared to the amount of collection activities taking place.
The fact that Capital Recovery received only four complaints last year is impressive considering the company had more than 18 million verbal and written contacts during that period, Klein said.
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