Last week, a Minnesota-based debt collection firm with a long history of shady practices and consumer complaints was slapped with a whopping $1.75 million fine by the Federal Trade Commission. It was the second-highest fine ever issued in a civil trial against a debt collection company. Among the offenses committed by the company, Allied Interstate, Inc., were charges that it violated the Fair Debt Collection Practices Act, the FTC said. Allied also tried to collect debt without proof or checking for accuracy – the same accusation that’s now roiling the foreclosed mortgage market.

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Debt collection is big business and because of its potential impact, the government has established very strict rules about how it should be done. Clearly, as we wrote in our story about the aggressive tactics collectors sometimes use, not every company plays by the rules.

Here are some tips for dealing with debt collection and understanding the rules:
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