Federal Judge Orders Debt Collector Global Circulation To Temporarily Cease Operations

A federal judge has ordered debt collector, Global Circulation Inc. (GCI) to temporarily halt operations, following an FTC complaint that alleged GCI tricked consumers into paying more than $7.6 million in bogus debt by threatening them with jail time, harassing their family members, and taking other unlawful actions.

U.S. District Judge Eleanor S. Ross of the Northern District of Georgia also ordered company owner Kenneth Redon, III to turn over the company’s assets to a court-appointed receiver.

In its complaint, the FTC alleged that GCI and Redon contacted consumers under several fictitious company names, including Total Mediation Solutions, Total Consumer Solutions, and Consumer Impact Recovery. “The company’s collectors called consumers out of the blue and threatened them with arrest, wage garnishment, and lawsuits if they didn’t pay a supposed debt,” the FTC said.

The complaint stated that the debts GCI was attempting to collect either did not exist or were not debts that GCI could legally collect.

“The company’s calls to consumers [were often ] incessant, with some receiving calls multiple times a day, [and with the company] leaving voicemails saying to call about an urgent legal matter,” according to the FTC. “When consumers answer[ed], they’re told that, unless they [paid] the bogus debts on that phone call using a credit or debit card, [they would] face legal peril.” In other cases, GCI also called consumers’ family members, the FTC alleged.

The FTC said that company employees regularly failed to identify themselves as debt collectors, as required by the Fair Debt Collection Practices Act and often claimed to have sensitive personal information that they used to convince consumers that their demand for payments were legitimate.

The Commission vote authorizing the staff to file the complaint was 5-0.

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