Recently, the Federal Trade Commission shut down a business that was accused of using deceptive tactics to collect on phantom loans (a fake debt that a consumer is led to believe he or she owes). In fact, the FTC has received thousands of complaints about similar companies taking part in underhanded debt-collection practices. The government agency is responding by suing these companies and making sure they discontinue operations. If you receive a suspicious call about a debt you don’t recognize, take action. Don’t pay the debt just to get the collector to stop contacting you. Why give away your hard-earned cash? If you hand over money to a fraudulent debt collector without putting up a fight, you’re likely to be targeted by a scammer again. The FTC says a caller might be a fake debt collector if he or she: Asks for payment on a debt for a loan you don’t recognize Refuses to provide a mailing address or phone number Asks for personal information Attempts to scare you into paying (by threatening to have you arrested, for example) Here are four tips from the FTC for avoiding a phantom debt-collection scam: 1) If you receive a questionable call from a debt collector, request the caller’s name, company, street address, and telephone number. Refuse to discuss the debt until you receive a “validation notice,” which includes the amount of the debt, the name of the creditor you owe, and your rights under the federal Fair Debt Collection Practices Act. Send a letter requesting the caller to cease contact. 2) Don’t provide the caller with personal financial or other sensitive information. 3) Tell your creditor about the suspicious calls and find out who (if anyone) the creditor has authorized to collect the debt. 4) Alert the FTC and your state Attorney General’s office about the suspicious call.