The phone rings at six in the morning, and you already know who it is. MCA collectors do not respect the boundary between persistence and persecution, and the distinction matters because one of those categories carries legal consequences the collector would prefer you did not understand.
Calls Before 8 AM and After 9 PM
Federal and state debt collection statutes recognize that certain hours belong to the debtor. Under the FDCPA framework and its state counterparts, contact before eight in the morning or after nine at night constitutes a per se violation in many jurisdictions. The California Rosenthal Fair Debt Collection Practices Act, expanded by SB 1286 to cover certain commercial debts as of mid 2025, imports these same timing restrictions into the small business context. A collector who dials your personal cell at dawn is not being aggressive. That collector is generating evidence.
The question one should ask is not whether the call was annoying. The question is whether you documented the timestamp.
Threatening Criminal Prosecution
Failure to repay a merchant cash advance is a civil matter. When a collector tells you that criminal charges are forthcoming, that a warrant will issue, or that the police will become involved, the collector has crossed from collection into coercion. In certain jurisdictions this conduct constitutes criminal harassment or extortion, depending on the specificity of the threat and the collector’s knowledge of its falsity.
A 2024 enforcement action out of New York’s attorney general office confirmed what practitioners had observed for years: MCA collectors were routinely invoking arrest and prosecution language against small business owners who had no criminal exposure whatsoever. The threat works precisely because the borrower does not know it is baseless.
Contacting Your Customers or Vendors
This is the tactic that causes the most commercial damage, and it is the one collectors deploy when conventional pressure fails. An MCA collector who contacts your customers, discloses the existence of your debt, or implies that your business is insolvent has done something that goes beyond collection. That collector has tortiously interfered with your business relationships.
The damages from this conduct are not theoretical. A restaurant whose suppliers receive calls from a collector loses credit terms. A contractor whose general contractor learns of the debt loses the next bid. The injury compounds in ways the collector understands perfectly well, which is why the tactic exists in the first place.
We had one client, a plumbing contractor in the Valley, who lost three vendor relationships in a single week because an MCA collector called each supplier and told them the business was “going under.” None of it was true. The business survived. Those vendor relationships did not.
Impersonating Legal Authority
Some collectors identify themselves as attorneys when they are not. Others claim to represent a court, a government agency, or law enforcement. Still others use language carefully designed to imply legal authority without stating it outright, words like “enforcement division” or “compliance department” attached to what is, in reality, a third party collection firm operating from a rented office.
In February 2026, New York’s FAIR Business Practices Act amended General Business Law Section 349 to extend protections against deceptive practices to small businesses and nonprofits. A collector who misrepresents authority in that state now faces scrutiny not only under traditional collection statutes but under the state’s broadened consumer protection apparatus.
Repeated Calls With Intent to Annoy
Volume alone can constitute harassment. Twelve calls in a single day. Twenty in a week. The FDCPA prohibits causing a telephone to ring repeatedly with the intent to annoy, abuse, or harass. State statutes echo this prohibition with varying thresholds. But the pattern matters more than any single call. A collector who calls twice is collecting. A collector who calls a dozen times after being told to stop is building your case for you.
We tell clients to stop answering after the third call in a day and to let each subsequent attempt go to voicemail. The voicemail is the evidence. The silence is the strategy.
Using Obscene or Abusive Language
It happens more often than one would expect from entities that present themselves as financial professionals. Profanity directed at the debtor. Insults aimed at the debtor’s intelligence, business acumen, or character. Comments about family members. The language tends to escalate in direct proportion to the collector’s frustration, and that escalation is almost always recorded on the borrower’s end if the borrower has been advised to record.
California is a two party consent state for recording. New York is one party. The jurisdictional question matters, and it should be resolved before the next call arrives.
Debiting Your Account Without Authorization
An MCA agreement typically authorizes specific ACH withdrawals on a defined schedule and in defined amounts. When a collector withdraws funds outside the agreed schedule, in amounts exceeding the agreement, or from an account not specified in the contract, that withdrawal is unauthorized. It may also constitute conversion, which is a cause of action that carries its own remedies independent of any collection statute.
The distinction between an authorized debit and an unauthorized one lives in the four corners of the agreement you signed. If you no longer have your MCA contract, obtaining a copy is the first task, not the second.
Threatening Employees or Family Members
A collector who contacts your spouse, your parents, or your employees about your MCA obligation has, in most circumstances, violated both federal and state collection statutes. The exception is narrow: the collector may contact a third party once, solely to obtain location information about the debtor, and may not disclose the existence of the debt in doing so.
What we observe in practice bears no resemblance to that narrow exception. Collectors call front desk staff and tell them the business is being sued. They call the owner’s spouse and describe financial ruin. They contact business partners and suggest the partnership should be dissolved. Each of these contacts is a separate violation, and each carries its own statutory damages.
Misrepresenting the Amount Owed
MCA agreements are already difficult to parse. Factor rates, holdback percentages, and reconciliation provisions create a thicket of numbers that most borrowers do not fully understand at signing. A collector who inflates the balance, adds fees not authorized by the agreement, or refuses to provide a clear accounting of the amount claimed has committed a deceptive trade practice in every jurisdiction that has considered the question.
The obligation to validate the debt is not optional. Under federal law, a collector must provide written verification of the debt within five days of initial contact. Under the expanded Rosenthal Act in California, the documentation requirements for commercial debts are even more granular. A collector who cannot or will not produce this documentation is telling you something important about the validity of the claim.
Nine examples, and none of them are unusual. In the merchant cash advance industry, aggressive collection is the norm rather than the deviation. But the law has begun to catch up. California’s SB 1286, New York’s FAIR Business Practices Act, and a growing body of state attorney general enforcement actions have created real exposure for collectors who treat small business owners as targets without rights.
The gap between what a collector does and what a collector may lawfully do is where your defense lives. Documenting every call, preserving every voicemail, and retaining every piece of correspondence transforms the dynamic from one of pursuit to one of accumulation. You are no longer the quarry. You are the recordkeeper. And recordkeepers, in litigation, tend to prevail.
A consultation with our team costs nothing and presumes nothing. If you are receiving calls that feel wrong, they may well be actionable, and the first conversation is where that determination begins.
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