Originally Answered: Can a collection agency file a 1099 on a debt that is past the statute of limitations?
> 1st per the Fair Debt Collection Practices Act, they have to send you a letter, do you dispute debt? For convenience, you can always say yes, or no, of course it is a moral question there, up to you. Did they send this letter originally?
>This is a factored debt. Factoring is one of the fastest growing businesses in the U.S., buying and selling of debt, my guess they bought the debt for pennies on the dollar if it is that old.
>Under the above law they cannot say anything they do not intend to do, like say they are going to sue, then don't would be a violation.
>The only time a 1099 would be sent is if you made a settlement on a debt, and since you obviously did not make a settlement, this is an illegal, and unjust attempt at making you pay, and it is particularly dangerous to you, because if you pay $1 on the debt you have re-started the statue of limitations on the debt.
>I would immeditately obtain all names involved, name of agency, gent who said that, and immediately contact the Federal Trade Commission, and the attorney general of your state.
>This industry reigned in from calling people 25 yrs ago, making believe they were the city marshall, and were on their way to pick up someones furniture.......was regulated successfully by the FDCPA, the law mentioned above. The factoring business, buying and selling of debt has opened a whole new avenue of abuse, whereas they even sometimes will sue someone. like your situation, beyond the statute of lims with the hope the consumer doesn't show up in court, court not knowing the situation gives judgement to shady attrny for agency.
>The debt collection agency business, originally corrected by the above law, has now reverted to practices like this, and are in need of new legislation to stop the abuse, also, the debt settlement companies are getting away w/enormous predator violations. Federal officials are focused on homeland security, I had a similar fraud situation, mailed all info to local FBI, actually spoke to an agent, who told me that much of the "schemes" in this situation are now on the backburner, homeland security their main focus.
>Immediatly contact the FTC & the Attorney General of your state and file a written complaint.