NEW YORK (AP) — The Federal Trade Commission said Thursday that several debt collectors have been banned from the business for abusive practices, including berating consumers, telling their neighbors about their debts and even threatening to dig up the bodies of relatives if they did not repay funeral bills.
The FTC said David M. Hynes II and Lorena Quiroz-Hynes agreed to the permanent ban as part of a settlement that also includes a series of businesses connected to Hynes. The FTC agreed to accept a payment of $700,000 on what was a $33.8 million assessment, saying the accused cannot pay the full amount.
The collection operation was based in Van Nuys, Calif., but the FTC says they worked with small businesses around the country.
There was no listed phone number for Hynes and Quiroz-Hynes in Van Nuys, and a message left with a lawyer who has represented them was not immediately returned.
The agency said the defendants had deceived small businesses who had hired them to collect debts and threatened those who owed money. At least two people who owed money to funeral homes were told the bodies of their children would be disinterred if the bills were not paid, the agency said. One was told that her daughter's body would be dug up and hanged from a tree. She was also told her dog would be shot and eaten if she didn't pay up. Other defendants were threatened with violence or were told they could be arrested.
The FTC said the defendants kept more money than they were entitled to from small businesses that had hired them, sometimes keeping all of it and bilking clients for fictitious legal expenses.
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