Capital Acquisitions and Management Corporation (CAMCO) was a United States debt
collection agency
Debt collection is the process of pursuing payments of debts owed by individuals or businesses. An organization that specializes in debt collection is known as a collection agency or debt collector. Most collection agencies operate as agents of ...
and subsidiary of Risk Management Financial Services, Inc., that was fined and closed down for repeated violations of the
Fair Debt Collection Practices Act
The Fair Debt Collection Practices Act (FDCPA), Pub. L. 95-109; 91 Stat. 874, codified as –1692p, approved on September 20, 1977 (and as subsequently amended) is a consumer protection amendment, establishing legal protection from abusive deb ...
(FDCPA). Its closure marked the first time a
Federal Trade Commission
The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) antitrust law and the promotion of consumer protection. The FTC shares jurisdiction o ...
investigation shut down a collection company.
CAMCO was a
debt buyer
Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The de ...
focused on long overdue
accounts - sometimes over a decade old, i.e. well beyond the statute of limitations - that it purchased for less than a penny on the dollar. Its employees would contact debtors by phone to collect funds. Consumers complained that collectors were calling late at night and/or using threatening language. Consumers also complained that they often had never heard of the supposed debt. After receiving numerous complaints from
consumer
A consumer is a person or a group who intends to order, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, who is not directly related to entrepreneurial or business activities. ...
s regarding these abusive debt collection practices, the Federal Trade Commission (FTC) began an investigation of CAMCO in 2003. On 24 March 2004, the FTC filed a formal complaint alleging multiple violations of the FDCPA. On the same day, a
consent decree was entered, in which CAMCO agreed to pay a $300,000 civil penalty and to refrain from further violations of the law.
Notwithstanding the agreement, complaints of violations from consumers continued. Accordingly, on 3 December 2004, the FTC obtained an
injunction
An injunction is a legal and equitable remedy in the form of a special court order that compels a party to do or refrain from specific acts. ("The court of appeals ... has exclusive jurisdiction to enjoin, set aside, suspend (in whole or in p ...
against CAMCO and its owners and froze their assets. CAMCO headquarters were shut down by local police officers and representatives from the Federal Trade Commission and the company ceased functioning.
The company was put into
receivership
In law, receivership is a situation in which an institution or enterprise is held by a receiver—a person "placed in the custodial responsibility for the property of others, including tangible and intangible assets and rights"—especially in c ...
and was forced to sell the consumer debts it had bought for collection. On January 19, 2005, the debts were sold at a
public auction
In public relations and communication science, publics are groups of individual people, and the public (a.k.a. the general public) is the totality of such groupings. This is a different concept to the sociological concept of the ''Öffentlichk ...
in New York to another debt buyer.
CAMCO Debt Auction Spectacle Nets Good Results
- insideARM.com , January 20, 2005
On 30 November 2006, CAMCO and the Federal Trade Commission entered into a stipulated settlement Order
Order, ORDER or Orders may refer to:
* Categorization, the process in which ideas and objects are recognized, differentiated, and understood
* Heterarchy, a system of organization wherein the elements have the potential to be ranked a number of ...
whereby CAMCO, its owners and its affiliated companies agreed to pay an additional $1 million penalty and to a permanent ban from engaging in any debt collection activity.
External links and references
March 2004 FTC ComplaintMarch 2004 Consent DecreeDecember 2004 injunction and asset freeze OrderABC news article
Footnotes
Defunct financial services companies of the United States