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Fact #35 PsychologyTactics

$8,254,368judgment against a phantom debt collector, partly suspended for inability to pay

In 2025, operators using names like Blackstone Legal Group and Viking Legal Services were hit with an $8,254,368 judgment for threatening arrest at work over debts the FTC says never existed.

The threats also included wage garnishment and seizing homes. A debt collector cannot arrest anyone, seize a home or garnish wages without a court judgment. The permanent ban from debt collection is the part that operates going forward.

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Source: US Federal Trade Commission · US Federal Trade Commission. Read more: phantom debt collection · case file

Sources

  1. FTC Action Leads to Court Order Halting Phantom Debt Collection Scheme That Took Millions from Consumers and Threatened Consumers' Credit, Homes, and Employment. US Federal Trade Commission. Accessed 2026-09-06. Supports: The 3 March 2025 restraining order, the court, the defendants and all six trading names, the threats alleged, and the statement that the debts never existed.
  2. Phantom Debt Collectors to Face Permanent Ban as a Result of FTC Lawsuit. US Federal Trade Commission. Accessed 2026-09-06. Supports: The 16 June 2025 proposed order, the permanent industry ban, the $8,254,368 judgment and its partial suspension.