Someone take note of my commentary as it is not often that I praise government intervention into the private sector. A big exception to my restraint is a good old fashioned crack-down on what has been described as deceptive money grabbing activity by others. I have even less tolerance for those who takes advantage of the unaware or the financially challenged consumer.
Yesterday the FTC announced a $2.5 million settlement with Asset Acceptance Capital Corp., for alleged violations of federal law in attempts to collect stale debt. This was well-reported by Jessica Silver-Greenberg in her WSJ column.
The issue of stale debt collection is only one of the many problems that face consumers who lack financial literacy. Much like getting plenty of rest, eating well, wearing proper clothing for the weather and a flu shot can ward away bad health in the winter, so good financial literacy, a well managed budget and careful spending can avoid financial illness. Case in point, if one knows what he or she owes and has a plan on how to pay it, someone alleging a “debt” that falls outside the well understood parameters of the consumer’s established budget, will be hard pressed to gain access to the consumers hard earned cash.
So here I go again! While I do commend the FTC for its appropriate actions, I also suggest more personal responsibility among consumers – and the concept of consumer health through financial education!