The Federal Trade Commission yesterday announced a settlement that will result in a permanent ban from engaging in debt collection for Blackstone Legal and its affiliated companies. including owners Ryan and Mitchell Evans. The resolution follows a February 2025 lawsuit filed by the FTC accusing the operation of fabricating debts and using aggressive, deceptive tactics to coerce payments from consumers.
The background: The FTC’s complaint alleged that Blackstone Legal and its related entities operated a phantom debt collection scheme under various names, including Blackrock Services, Quest Legal Group, Capital Legal Services, and Viking Legal Services.
- The defendants falsely told consumers they owed debts, often to payday lenders, and threatened lawsuits, wage garnishment, and credit damage if the debts weren’t paid, according to the suit.
- Consumers were led to believe the threats were legitimate due to the inclusion of sensitive personal information in the letters and the professional appearance of the company’s websites. Many paid to avoid what they believed were real legal consequences.
- The FTC charged that these threats were entirely fictitious and that the defendants had no legal authority or evidence to back their claims. The scheme allegedly collected millions of dollars from unsuspecting consumers.
The settlement: The defendants have agreed to a proposed stipulated order that imposes several significant penalties:
- A permanent ban from the debt collection industry for all defendants.
- A prohibition on misrepresenting any product or service, particularly concerning financial obligations.
- A ban on using false or fraudulent pretenses to obtain consumer financial information or impersonating any legitimate business or law firm.
- The surrender of substantial assets, including funds from numerous bank and investment accounts.
While the order includes an $8.25 million judgment, that amount is partially suspended due to the defendants’ claimed inability to pay.
What they said: “This operation collected on false debt and harassed consumers with fake threats of lawsuits and damaged credit if they refused to pay,” said Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection. “Scams like this cause significant harm to consumers and undermine legitimate debt collection activity, and the FTC will continue to act to stop them.”
