Yes, you can and should dispute a fraudulent account even if it’s already been sent to a collection agency. Identity theft doesn’t become legitimate debt simply because it has been passed on. In fact, the Fair Credit Reporting Act (FCRA) and Fair Debt Collection Practices Act (FDCPA) offer strong protections for consumers in these situations.
You should begin by sending a written dispute to the debt collector, along with copies of your identity theft report (from the FTC), a police report, and any other supporting documents. Clearly state that the debt is fraudulent and that you do not owe it. Under the FDCPA, the collector must cease collection activities while they investigate your claim.
Also, notify the original creditor and the credit bureaus about the fraudulent account. The credit bureaus are legally obligated to investigate your dispute and remove the item from your report if it’s found to be inaccurate due to identity theft.
If the collection agency continues to harass you or report the fraudulent account despite clear evidence, you may have grounds for a lawsuit. At our firm, we help clients take legal action to stop harassment, fix credit reports, and seek damages for harm caused by improper debt collection.
