Georgia announced it has reached a $4.3 million settlement with an abusive debt collection company. The state said it hoped the settlement would send a message to other debt collection companies looking to skirt the law when it comes to dealing with residents burdened with credit card debt and other types of consumer debt.

According to the Georgia Governor’s Office of Consumer Protection (OCP), Nelson, Hirsch & Associates Inc., used abusive practices that are illegal under state and federal law to collect on 5,809 consumer accounts, most of which consisted of zombie debt, or debt that has long been written off by the original creditors.

To collect debts from its accounts, the state said that employees of the Fairburn-based debt collection company routinely failed to disclose their true identity as debt collectors, falsely represented themselves as fraud investigators or as affiliated with a law firm, refused to send consumers written proof of alleged debts, harassed people at work, made debt collection calls after 9 p.m., called some people up to 50 times a day, threatened debtors with arrest and imprisonment, and threatened family members.

“The main thing is you don’t threaten people in terms of their debt,” said Bill Cloud, a spokesman for the OCP. “You don’t threaten them physically. You don’t threaten them with arrest. You don’t act like a law firm if you’re not. These people were just doing everything in the book that was wrong” (“Georgia Reaches $4 Million Settlement With Over-Aggressive Debt Collector,” WABE, Nov. 10, 2011).

Under terms of the settlement, Nelson, Hirsch & Associates and its owner, Tanya Santiago, are required to cease business operations and refrain from engaging in debt collection activities in the state or in connection with Georgia consumers for at least five years. The company is also required to forego collection on its accounts, which total $4,307,658, pay a $26,000 civil penalty, and reimburse the OCP for investigative and legal expenses totaling $24,000.

“We are sending a strong and clear message that this kind of abuse and harassment of consumers, and the egregious disregard for the law that these practices typify will not be tolerated,” John Sours, Administrator of the OCP, said in a statement (“Debt Collector Nelson, Hirsch & Associates Enters into $4.3 Million Settlement,” Georgia Governor’s Office of Consumer Protection press release, Nov. 8, 2011).

Cloud said that if consumers are in trouble because of debt, they should contact a reputable consumer counseling service and develop a payment installment plan that they can afford.

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