‘Phantom debt’ haunts thousands of consumers each year

The Federal Trade Commission (FTC) in 2022 returned more than $1 million to consumers conned in a “phantom debt” collection scheme.

Phantom debt is a term for debt that either does not exist, has already been discharged, or has been artificially (and illegally) inflated, but somehow continues to haunt the debtor, according to the Consumer Financial Protection Bureau (CFPB). Thousands of consumers are targeted in phantom debt schemes every year.