September 21, 2018 / 7:38 PM / a year ago

UPDATE 1-U.S. FTC, NY ban debt collectors that threatened consumers with arrests

(Adds receiver, comment from lawyer)

By Jonathan Stempel

NEW YORK, Sept 21 (Reuters) - Three upstate New York debt collectors and their principals have accepted permanent industry bans and agreed to pay $27 million to resolve federal and state charges of abusive collection practices, including false threats to have consumers who failed to pay their debts arrested and jailed.

The settlement was announced on Friday by the Federal Trade Commission and New York Attorney General Barbara Underwood.

Vantage Point Services LLC and Gregory MacKinnon are required to pay $22.53 million of restitution and damages, and Payment Management Solutions Inc and Angela Burdorf must pay $4.42 million. Payments from Bonified Payment Solutions Inc and Joseph Ciffa were suspended because of their inability to pay.

Regulators accused the defendants of concealing information about their identities in phone calls, failing to provide basic information about alleged unpaid debts, contacting consumers’ friends and family about the debts, and warning consumers they faced a minimum 90 or 120 days in jail if they did not pay up.

For purposes of the settlement, the defendants “admit the facts necessary to establish jurisdiction” and waived their rights to appeal it, according to court papers they signed that were filed this week.

Vantage Point was based in Amherst, New York, and Payment Management and Bonified were based in Niagara Falls, New York. A receiver has been appointed to liquidate Vantage Point and Payment Management.

Lawyers for Vantage Point, Payment Management, MacKinnon and Burdorf did not immediately respond to requests for comment.

The lawyers include Dennis Vacco, who was New York’s attorney general for four years beginning in 1995.

Joseph Makowski, a lawyer for Bonified and Ciffa, in an interview said his clients decided it was in their best interest to settle. (Reporting by Jonathan Stempel in New York; editing by Bill Berkrot)

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