You may have the basis for suing the collection agency for violations of the Fair Debt Collection Practices Act and other statutes. If you have a good case you can recover statutory penalties of up to $1,000 per violation, any actual damages that you can prove and your attorney's fees. You should consult an attorney who sues abusive debt collectors.
I would recommend meeting with a local attorney who practices consumer law (specifically FDCPA violations) to discuss whether this debt collector has violated the law. The debt collector may have violated the Fair Debt Collection Practices Act and other state specific collection laws. You can search for a consumer law attorney who is located in your area on Avvo.