The law I posted re: theft of services is all aimed at utility providers.
You can write whatever you liked but you came here for advice on what you can legally do. But you might want to read this section of the FCRA first. What I bolded.
§ 807. False or misleading representations
A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:
(1) The false representation or implication that the debt collector is vouched for, bonded by, or affiliated with the United States or any State, including the use of any badge, uniform, or facsimile thereof.
(2) The false representation of --
(A) the character, amount, or legal status of any debt; or
(B) any services rendered or compensation which may be lawfully received by any debt collector for the collection of a debt.
(3) The false representation or implication that any individual is an attorney or that any communication is from an attorney.
(4) The representation or implication that nonpayment of any debt will result in the arrest or imprisonment of any person or the seizure, garnishment, attachment, or sale of any property or wages of any person unless such action is lawful and the debt collector or creditor intends to take such action.
(5) The threat to take any action that cannot legally be taken or that is not intended to be taken.
(6) The false representation or implication that a sale, referral, or other transfer of any interest in a debt shall cause the consumer to --
(A) lose any claim or defense to payment of the debt; or
(B) become subject to any practice prohibited by this subchapter.
(7) The false representation or implication that the consumer committed any crime or other conduct in order to disgrace the consumer.
(8) Communicating or threatening to communicate to any person credit information which is known or which should be known to be false, including the failure to communicate that a disputed debt is disputed.
(9) The use or distribution of any written communication which simulates or is falsely represented to be a document authorized, issued, or approved by any court, official, or agency of the United States or any State, or which creates a false impression as to its source, authorization, or approval.
(10) The use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer.
(11) The failure to disclose in the initial written communication with the consumer and, in addition, if the initial communication with the consumer is oral, in that initial oral communication, that the debt collector is attempting to collect a debt and that any information obtained will be used for that purpose, and the failure to disclose in subsequent communications that the communication is from a debt collector, except that this paragraph shall not apply to a formal pleading made in connection with a legal action.
(12) The false representation or implication that accounts have been turned over to innocent purchasers for value.
(13) The false representation or implication that documents are legal process.
(14) The use of any business, company, or organization name other than the true name of the debt collector's business, company, or organization.
(15) The false representation or implication that documents are not legal process forms or do not require action by the consumer.
(16) The false representation or implication that a debt collector operates or is employed by a consumer reporting agency as defined by section 1681a(f) of this title.
If it is actually criminal, I have no problem with contacting our local law officer (he's a good friend) and having her arrested. If I threaten it, I will follow through on that threat. But like I said before I don't think I'm actually threatening to have her arrested, I'm just trying to scare her and make her think twice about not paying us. Besides I used the qualifying adjective 'possible' which means I'm not sure if it is and no where in the letter do I say I will have her arrested, I do say definitively that I will sue her in court. I might have to have a sit down with my cop friend and see what he thinks...
Your cop friend isn't going to know more than what was written in the state laws I linked and isn't likely to know anything about the FCRA.
It isn't illegal in your state. If you threaten criminal action your will be violating the FCRA.
But do what you want I'm done trying to help you.
If you're concerned about the money, why not just sue her in small claims court? That system is there for people who want the courts to settle relatively small financial disputes. It's not like you'll need someone to argue the ins and outs of constitutional law or will be calling doctors or scientists as witnesses.
Don't send that letter, either. Whenever I see business owners threatening criminal stuff (even if it's just a "shoplifters WILL be prosecuted" sign), I tend to judge the business as much as I judge who they're threatening.