Debt Harassment News:

After criticism, McCollum, Sink vow to rein in abusive debt collectors
By John Frank, Times/Herald Bureau
In Print: Wednesday, November 4, 2009

http://www.tampabay.com/news/politics/stateroundup/after-criticism-mccollum-sink-vow-to-rein-in-abusive-debt-collectors/1049256

TALLAHASSEE  Responding to criticism over inactivity on 4,400 state complaints against debt collectors, Attorney General Bill McCollum and Chief Financial Officer Alex Sink proposed separate measures Tuesday to rein in abusive tactics. The gubernatorial rivals' dueling announcements coming less than 30minutes apart  further inflamed a weeklong feud that began after the Orlando Sentinel exposed serious cracks in the system designed to protect consumers.  The analysis found McCollum's office did little to address 4,400 complaints received this year. His office blamed Sink, even though her office doesn't oversee the Office of Financial Regulation, which licenses the collectors. The fight served as a precursor to the governor's race between Sink, a Democrat, and McCollum, a Republican.  Sink declared her support for four reforms that would make it easier to investigate, punish and track problematic debt collectors.  "We do need to put more teeth in the laws," Sink said in an interview. "We need some new legislation to prevent these debt collectors from harassing our citizens. "Less than 30 minutes later, McCollum's office issued a statement asking the Legislature for more power to file civil lawsuits against the aggressive debt collectors. In a letter to House Speaker Larry Cretul and Senate President Jeff Atwater, McCollum proposed an initiative to make some tactics an inherent violation of the state's Deceptive and Unfair Trade Practices Act. "I'd like to have the law changed so it's easier to prove," McCollum said at a news conference. "So if my office wants to, we can go to court and shut down those debt collectors. "McCollum said his office formed a taskforce to look at each complaint and work with the financial regulation office.

Is Texting the Next Frontier in Collections?
By Darren Waggoner and Peter Lucas
August/September 2009 Collections & Credit Risk

U.S. CONSUMERS SEND 80 BILLION text messages a month on their cell phones, according to Maynard, Mass.- based Mercator Advisory Group Inc. The number has not escaped the attention of financial service companies, which see "texting" as a way to build communications with customers.

Financial service providers send 12 million text messages per day, reports Mercator. Most of the messages are service-related messages permitted by the account holder - such as alerts sent to notify customers when a transaction has occurred or that a checking account is close to being overdrawn.

"Texting is a channel that consumers consider less intrusive, gets right to the point, and can be used to complement traditional communications channels," says John Messall, director of customer finance services at Overland Park, Kansas-based cellular carrier Sprint Nextel.

The collection industry is concerned, however, that the Fair Debt Collection Practices Act (FDCPA) and state laws are too antiquated to fairly govern the use of text messaging as a means for contacting debtors.

"The biggest concern is that the [FDCPA] and state laws really don't address how to use these new methods of communications," says David D. Chesner, legal counsel and legislative director of state government affairs at ACA International, a trade group for collectors.

Texting is one area where current laws hinder collectors' ability to fully use the technology, Cherner tells Collections & Credit Risk. First, he says, texting offers only a limited number of characters to provide information to consumers. Federal and state laws, however, require extensive disclosures that can exceed the character count. Also, there is a greater likelihood that the text could be inadvertently disclosed to a third party if two people share a cell phone, thus violating the FDCPA.

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Bill collectors may call, but in most cases, you can't inherit a debt
By Ivan Penn, Times Staff Writer
In Print: Saturday, August 15, 2009
http://www.tampabay.com/features/consumer/bill-collectors-may-call-but-in-most-cases-you-cant-inherit-a-debt/1027735

Now, don't go trying to scam bill collectors. (Lord knows, I've got plenty of bills to pay.) Big Mama taught us better than that.

But the Federal Trade Commission issued an alert recently to help consumers understand what their obligations are under the law when it comes to paying the debts of their deceased family members.

"Generally, someone's estate is responsible for paying their debts," the FTC said in its alert. "But if there isn't enough in the estate to cover the debts, they typically go unpaid."

In other words, it's not your problem. Read more...

 

Widespread Harassment from Phony Debt Collectors Raises Concerns of Mass Data Breach, Warns BBB

WEDNESDAY, 12 AUGUST 2009 04:16 PRESS RELEASE HUMAN INTEREST

HTTP://WWW.ENEWSPF.COM/

Chicago, IL(ENEWSPF) Scammers may have Social Security and bank account numbers, home addresses and employer information

Chicago, IL - August 5, 2009 - The Better Business Bureau is issuing an alert about phony debt collectors that are calling consumers nationwide and claiming that they have defaulted on a payday loan and will be arrested if they don't pay immediately. Claiming to be lawyers, the scammers say they are with the "Financial Accountability Association" or the "Federal Legislation of Unsecured Loans" and are equipped with a disconcerting amount of personal information about their potential victims.

"Because the scammers have so much information about potential victims, the BBB is concerned that this may be the result of a data breach," said Steve J. Bernas, president & CEO of the Better Business Bureau serving Chicago and Northern Illinois. "Thousands of people may have had their personal information compromised, and given the scammers' tactics, it appears that those who have previously used payday loan services could be particularly at risk."

According to reports received by the BBB and posted online, the scammers accuse the victim of defaulting on a payday loan and claim they are being sued. The phony debt collector threatens that, if the victim doesn't pay as much as $1,000 immediately via wire or by providing bank account or credit card numbers, he or she will be arrested and extradited to California within the hour to stand trial. The scammers often may have the victim's Social Security, old bank account numbers or driver's license numbers as well as home addresses, employer information and even the names of personal friends and professional references.

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Debt Collector Harassment

FOX25 Special Report
Updated: Friday, 08 May 2009, 1:43 PM EDT
Published : Thursday, 07 May 2009, 8:15 PM EDT

(myfoxboston) - Job loss, medical issues, and getting over-extended are just some of the reasons why people get stuck in debt. With the economy in crisis, defaults are at an all-time high. Creditors do have a right to the money they are owed. But some of the tactics collection agencies are using can only be described as outrageous.

With her son, Randy, serving a second tour in Iraq, Diane Stadelbauer has enough to worry about.

He was just obnoxious, very sarcastic, Stadelbauer says of the repeated calls from debt collectors, trying to hunt the army soldier down. What kind of a welcome home is this? Your threatening to have legal action waiting for him when he steps back in the country?

Diane says she and her husband received at least 10 calls, even though Randy hasn't lived with them in more than a decade.

They say the collection agency also phoned Randy's sister and even his ex-girlfriend, demanding $7,000 from a 1999 car loan.

It was truly egregious, she said.

And to make matters worse, Randy's Rhode Island-based lawyer, John Longo, says the loan in question was settled years ago.

Read more...

 

Debt Collectors: HuffPost Readers Report Harassment

By Arthur Delaney
First Posted: 06-12-09
http://www.huffingtonpost.com/2009/06/12/debt-collectors-huffpost_n_214505.html

The Tompkins County Public Library in Ithaca, N.Y. just can't get a break. Last week the Huffington Post reported that since November, the library has received an angry letter from some lawyer or attorney general every couple days because an unscrupulous debt collector has been giving the library's address to the poor saps the collector has been harassing.

This week, the indirect harassment of the Tompkins County Public Library continues!

"On Monday of this week, our library received yet another mailing addressed to "National Processing Division" from the United States Bankruptcy Court," wrote library director Janet Steiner in an email to the Huffington Post on Wednesday. "We returned it to the post office unopened."

Many HuffPost readers wrote in to share debt collector horror stories.

Rene Thompson of Kentucky wrote that her mother left no estate except a broken-down car when she died in June 2007. Thompson learned first-hand what can go wrong when debt purchased from a credit card company for pennies on the dollar is passed from collector to collector. After her mother died, Thompson wrote, she contacted her creditors to let them know she'd left no estate.

Most were very kind but about two weeks after her death I received a letter from a company asking me to call about one of Mother's credit cards. I called and that's when the hell started. The individual from a collection company started giving me flack for not being willing to pay Momma's bills myself. I explained that I had been on disability for almost 8 years due to an accident and was on a fixed income. He then suggested that I should have used the insurance money Momma left to bury her to pay them! That's about the time I had, as my Momma would have put it, a hissy fit. After the hissy fit, I called my cousin, the attorney.

Read more stories...

 

Consumer Tips Empowering YOU to be a savvy consumer

Posted By Gerri Willis, Personal Finance Editor
Defend against debt collectors
http://tips.blogs.cnn.com/2009/06/08/defend-against-debt-collectors/
June 8, 2009

78,838. According to the federal government, that's the number of people who formally complained about debt collectors last year. As more and more consumers are falling behind on their bills, the collections industry is trying harder than ever to collect that debt.

According to the Federal Trade Commission, more complaints are lodged against the debt collection industry than any other. And they're reportedly using technology like social networking sites or cell phone texting to get you to pay up. Experts say we're just seeing the tip of the iceberg.

1) Know the rules

First, there are strict laws about how debt collectors have to do business. They must identify themselves as debt collectors. They can't harass you and they can't talk about your debt to anyone but you or your attorney. You shouldn't be getting phone calls before 8 a.m. or after 9 p.m. They can't threaten to sue you if they don't have any intention to do so. And, they can't misrepresent the amount you owe.

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Debt Collectors Face The Wrath

By Michael Diamond
June 05, 2009  10:36 am
http://blogs.app.com/inthemoney/2009/06/05/debt-collectors-face-the-wrath/

You know the drill. Phone rings. You check caller ID. It's your lender/loan servicer/bail bondsman. They want their money. You don't have it. You don't answer. They call again. And again. And again.

A few New Jersey Assembly members feel for you. Democrats John J. Burzichelli, Matthew W. Milam, Wayne P. DeAngelo and Paul Moriarty have introduced a bill called the New Jersey Fair Debt Collection Practices Act to eliminate abusive efforts to collect debt. And it would give consumers a way to dispute their claim.

Among the highlights:

*A debt collector can't call you earlier than 8 a.m. or later than 9 p.m.

*A debt collector can't call you if he or she knows you are represented by an attorney with regard to the debt. I take it that means you're filing for bankruptcy.

*A debt collector can't call you at work. (Leave your cell phone in your car. Comcast keeps calling my cell phone while I'm at work. It's kind of annoying.)

Read more...

Companies call in collectors as cashflow bites

By James Thomson
SmartCompany
May 28, 2009 10:20am

CASH-strapped companies are turning to debt collectors to keep their companies afloat, with debt collection agency Dun & Bradstreet reporting a 20 per cent rise in the number of debts referred to it in the first three months of the year.

According to D&B's data, the dollar value of debts referred has also jumped sharply, increasing from $900 in the first quarter of 2008 to $1100 in the first quarter of 2009.

While the 20 per cent jump in debt referrals is a concern, D&B chief executive Christine Christian says the most worrying spike was a 146 per cent jump in the number of debts referred between the last quarter of 2007 and the last quarter of 2008.

"These businesses have been backed into a corner," she says. "They realise if they don't move they won't be at the front of the queue. There is only a limited amount of cash out there."

Most debts are being referred with 90 days of their due date, down from around 120 days a year ago.

While companies in New South Wales and Victoria are most common referrers of debt, the biggest spikes in debt referrals occurred in the Northern Territory (up 53 per cent), Queensland (up 52 per cent) and Western Australia (up 42 per cent).

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Past Debt Harassment Articles