An AFNI Collections account on your credit report can seem like a roadblock in the middle of a long journey. Your credit score plays a huge role in most of the major purchases and decisions you make in life — everything from the apartment you can rent to the interest rate on your car loan.
But here’s a secret the collection industry would rather you not know: this doesn’t have to be a permanent roadblock.
Credit reports aren’t criminal records. They’re documents that can be questioned, corrected, and improved. Even a legitimate debt can’t keep you from repairing your credit.
A study by U.S. PIRGs found that nearly 79 percent of credit reports contained errors or other major problems. If that’s the case, it’s essential to approach every negative listing on your report with a healthy dose of skepticism.
Who is AFNI Collections?
AFNI Inc. is a collection agency that is based in Bloomington, Illinois. The company was originally founded in 1936, but it was known as Slavens Collection Agency at that time. It changed its name to AFNI in June 2000.
AFNI primarily collects debts related to telecommunications accounts for major carriers such as AT&T, Verizon, Sprint, and DirecTV. The company also provides insurance subrogation claims. However, collection agencies don’t typically list their creditor clients, and those relationships are subject to change on a regular basis. This makes it nearly impossible for consumers to verify whether or not a collection agency is authorized to collect a debt.
Collection agency is facing regulatory issues
AFNI has faced its share of regulatory issues over the years. In November 2020, the Consumer Financial Protection Bureau (CFPB) issued Consent Order 2020-BCFP-0021 against the company. As a result, AFNI had to pay a $500,000 civil penalty for violating the Fair Credit Reporting Act (FCRA).
The CFPB found that AFNI reported 165,000 accounts as if the consumers had made no payments, even though they had. Another 72,000 accounts were reported as still owing balances when, in fact, they had been paid in full. The consent order said that AFNI failed to update the automated code it used for furnishing information to the credit reporting agencies for at least four years.
In addition to the CFPB consent order, AFNI agreed to pay $1.85 million to settle a class-action lawsuit after a data breach in June 2021 exposed the personal data of about 260,000 employees and customers. Since 2013, the company has been the subject of more than 2,635 complaints filed with the CFPB. Of those complaints, 44 percent involved consumers saying that AFNI was trying to collect debts that they did not owe.
How does AFNI Collections operate?
How do collection agencies work? Most collection agencies operate in one of two ways. Either they purchase charged-off debts from the original creditors for pennies on the dollar, or they attempt to collect debts on behalf of the original creditors in exchange for a fee. In either scenario, the collection agency’s goal is to collect as much money as possible as quickly as possible.
Debts may change hands multiple times, and the associated documentation may become incomplete or corrupted as it is transferred from one company to the next. Account records may contain errors introduced during the transfer process. In many cases, the original contract, payment records, and other documentation necessary to verify that the debt is owed by a particular consumer may not be available.
If many debts cannot be verified, that suggests collection agencies may not be verifying debts before purchasing or reporting them. If you’re a consumer who has been contacted about an unverified debt, this is an opportunity. Collection agencies are hoping you’ll pay without verifying the debt.
Why the documentation matters
One consumer who reviewed AFNI on the Better Business Bureau’s website said she received collection letters from the company based on nothing more than a shared name. She said when she called the company to ask about the debt, she was told it had found her based on her first and last name, despite not having access to driver’s license numbers or other identifying information from police reports it claimed to possess.
While that may seem like an extreme example, it illustrates the point. When collection agencies are sending letters to people simply because they share a name with someone who owed a debt, it’s clear they’re not doing much to verify that information before it ends up on credit reports. If you were targeted because of a lazy matching process, why is it your responsibility to prove you don’t owe the debt?
Federal law requires collection agencies to verify debts before reporting them to credit bureaus. In cases where that can’t be done because the documentation doesn’t exist or wasn’t transferred with the debt, consumers may have grounds for a dispute. The credit reporting system is meant to contain accurate information — not unverified claims.
What are my rights when it comes to collection accounts?
Your federal rights
The Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA) provide a number of protections for consumers who are dealing with collection accounts. You have the right to verify any debt that a collection agency says you owe. You have the right to dispute information on your credit report that you believe is inaccurate. You have the right to be free from abusive, deceptive, and unfair collection practices.
When consumers dispute information on their credit reports, credit bureaus have 30 days to investigate the claim. During that process, the credit bureau must reach out to the party that provided the information and that party must conduct a reasonable investigation. If it cannot verify the information, the credit bureau must remove it from the consumer’s credit report.
Those are your rights because lawmakers recognized that consumers are at an informational disadvantage compared to collection agencies. A collection agency may have access to documentation related to the account, along with the legal resources and practical experience to navigate the collection process. Federal law is designed to help level the playing field by imposing verification and accuracy requirements on collection agencies that report information to the credit bureaus.
Challenging unverifiable information
Disputing information that you believe is inaccurate, incorrect or unverifiable is not a loophole or a technicality. It’s a process that federal law created to ensure that information on your credit reports is accurate and substantiated. In cases where collection accounts cannot be verified during the dispute process, they must be removed. That’s the way the process is supposed to work.
The CFPB’s investigation into AFNI illustrates why consumers should take advantage of the dispute process. If the company was reporting hundreds of thousands of accounts with incorrect payment information, for example, it seems reasonable to question the accuracy of any particular account. In this case, we’re not talking about the possibility of errors. We’re talking about errors that have already been identified and confirmed by a federal agency.
Don’t expect collection agencies to respond to goodwill letters asking them to remove collection accounts voluntarily. Removing an account means the collection agency cannot collect the debt, so there’s no incentive for the company to agree to your request. The dispute process, on the other hand, creates legal obligations that the collection agency cannot ignore.
Why you should dispute, not pay
Why you shouldn’t pay a collection account
It’s tempting to pay a collection account simply to make it go away, but that’s not always the best approach. Paying a collection account will update the account’s status to “paid,” but the account will still be listed on your credit report. A paid collection account is still a collection account, and it may still affect your credit score for years after you pay it.
Collection agencies use a sense of urgency — and sometimes fear — to persuade consumers to pay up as quickly as possible. But once you pay, you’ve admitted that you owe the debt, and you give up most of your leverage. In many cases, ignoring a collection account and filing a dispute (if necessary) can be a much more effective strategy than rushing to pay an account that may not even be reported accurately on your credit report.
One consumer posted a negative review of AFNI on the Consumer Affairs website, complaining that the company’s representative promised to remove a collection account from her credit report if she agreed to make a payment. Instead, the representative called her back after the company received her payment to say that the item would remain on her report for seven years.
What happens when a collection account can’t be verified?
What happens if a collection account cannot be verified?
If a consumer disputes a collection account and the collection agency is not able to verify the account during the dispute process, the account must be removed from the consumer’s credit report. This is not an uncommon occurrence. Given the documentation issues that are inherent in the debt buying process, many collection accounts cannot survive a dispute.
If an unverifiable collection account is removed from your credit report, that does not mean your credit repair journey is over. In many cases, it’s just the beginning. Once the negative account is removed, you may have the opportunity to improve your credit score. You may have a cleaner credit report when you apply for a loan or credit account in the future.
In some cases, you may even be able to remove accounts that can be verified — if they include incorrect dates, balances or account statuses, for example.
The CFPB found that AFNI was reporting incorrect information on hundreds of thousands of consumer accounts. If you have an account from the company on your credit report, it’s worth taking a closer look.
Should I hire a professional to help me repair my credit?
The benefits of working with a credit repair company
Working with a credit repair company has a number of benefits. For one thing, the company can help you understand how to navigate the credit repair process — everything from sending proper dispute letters to communicating with collection agencies and credit bureaus.
Beyond that, credit repair companies may be able to help protect you from the emotional manipulation that collection agencies often use to get consumers to pay up. Everyone who works for a credit repair company is familiar with the tactics that collection agencies use to create a sense of urgency or instill a sense of fear or guilt in consumers.
As a result, consumers who work with credit repair companies are less likely to get pushed around.
Any information that you share with a collection agency can be used against you, so when you work with a credit repair company, you can help minimize the risk. Instead of engaging in a back-and-forth with a collection agency in which you may share information that weakens your position, you can insist that all communication go through your credit repair company.
Why DIY credit repair often fails
It’s possible to navigate the credit repair process on your own, but it’s not always easy. The dispute process has very specific requirements — including a 30-day timeline for credit bureaus to respond to disputes and specific requirements for the documentation that consumers must provide to verify their disputes.
Credit repair companies understand those requirements because they work with them every day. Many consumers do not, so when they try to repair their own credit, they may struggle to get results. Collection agencies have decades of experience processing millions of accounts, so when consumers challenge disputed accounts on their own, they’re at a disadvantage.
In addition to understanding the process and requirements, credit repair companies can also help provide accountability and follow-through.
When you’re disputing accounts and working to repair your credit, there are deadlines and time-sensitive notices that you must observe in order to maximize your chances of success. If you’re employed full-time or you have a lot of other commitments in your life, it may be difficult to find the time or bandwidth to manage all the details of the credit repair process.
That’s where a credit repair company can be helpful. The company can help track those deadlines and send those notices so you don’t have to. As a result, you may have a much better chance of a successful outcome.
Conclusion
If you have an account from AFNI Collections on your credit report, don’t assume that you’re stuck with it. The company has a history of regulatory issues and consumer complaints, and it may be worth challenging the account — especially if you believe that it’s inaccurate or that the company cannot verify the debt.
Don’t forget that you have rights under the FDCPA and FCRA, and don’t be afraid to exercise them. Whether you work with a credit repair company or you attempt to repair your credit on your own, the most important thing is to be proactive.
The automated systems that the CFPB said AFNI used to furnish information to the credit bureaus were flawed, and they may have placed incorrect information on your credit report. That does not mean the account is valid or that you have to leave it there. It may mean that the account cannot be verified, and if that’s the case, you may have grounds for a dispute.
Your credit recovery story starts now
If you have an account from AFNI Collections on your credit report, consider this the first page of a new chapter rather than the final sentence of the book. You may be able to dispute the account and have it removed from your credit report. You may be able to improve your credit score and create a brighter financial future.
At FightCollections.com, we help consumers dispute collection accounts and work toward cleaner credit reports. We understand the games that collection agencies like AFNI play, and we know how to respond. We can help with disputes, documentation, and follow-up so you can focus on the things that matter.
Contact us today for a free consultation, and let us help you evaluate your credit report, identify any potential inaccuracies, and explore your options. Your second act is waiting.
