Debt collection is a major industry in the United States. There are millions of Americans struggling to make ends meet and cover their monthly bills. These individuals may accrue debt that they can’t reasonably pay off, leading to debt collection efforts.

Despite how aggressive some of these companies may be, not all debts in collections are valid. For those facing collection efforts for an inaccurate or already paid debt, there are defense options available. Beyond just giving up and paying.

How do debts wind up with debt collection companies?

Companies often don’t want pictures to collection on their own behalf. Not only can the need to take aggressive action to collect on a debt tarnish their reputation, but it can also substantially increase the company’s overhead, as they may have to develop an entire department to go after unpaid invoices and outstanding bills.

Companies sell their outstanding debt to collection companies for a fraction of what they should actually receive. The debt collection company then reaps a profit if they successfully collect on the debt.

Unfortunately, this system of settling debt could mean that people who don’t owe anything wind up with bad marks on their credit or even threats of legal action from a collection company that claims they owe a debt.

Some companies attempt to collect on fake debts, while others collect debt you already paid

There are two primary ways in which a business might legally attempt to collect a debt. The first and more egregious situation is one in which the debt is entirely imaginary. There have been well-documented cases of businesses buying and selling fraudulent account information for potential collection activity.

It is also possible that in the process of selling and transferring unpaid debt, businesses report on debts that have actually been paid in full. A company could call you demanding payments for a medical service that you know you received, only it’s one that you may have already paid off.

You have the right to defend yourself against false collection activity

There are very strict laws in place regarding the collection of debt in the United States. You have the right to have inaccurate information removed from your credit report and to hold the company attempting to violate your right through inappropriate or illegal collection activity acountable.

You can potentially file a lawsuit against the business that violates debt collection practices, thereby protecting yourself and preventing others from falling victim to the same unscrupulous behavior in the future.