This account is slightly fictionalized for privacy reasons, but is accurate in the major details.
I hate debt.
I am what the credit card industry calls a “deadbeat.” That is to say, I pay my credit cards every month, no exceptions. If I can’t afford it, I don’t buy it. They have gotten me for late fees exactly once over many, many years.
I don’t have a mortgage, and wouldn’t get one under present conditions. In a nation where employees are disposable and the idea of a “career” is an anachronism, it’s a mistake to put oneself at the mercy of employers. Put the money you save in the bank.
I don’t have much sympathy for people who run up credit cards, imagining that they’ll be rescued by the Rapture or whatever. Yes, on the other end of the spectrum are those who get into debt over medical bills; for them I have plenty of sympathy, but don’t see the solution as taking it out on creditors. People need reliable work at decent pay, and insurance against illness. People who end up in debt as a result of unemployment or medical expenses are simply doing what they have to in order to survive. People who end up in debt for (almost) any other reason are placing the yoke around their own necks.
Given my dislike of debt and the fact I don’t have any, it might surprise you that I am on the harassment list of a very large number of debt collectors–perhaps several dozen, though they engage me singly rather than as a horde. How it came about is a bit of a mystery.
My guess is that it has to do with how debt collectors go about finding their victims. Since genuine deadbeats generally make themselves scarce, debt collectors apparently go about finding the responsible party with all the finesse that Katherine Harris used in barring ineligible voters from the 2000 Florida election, which is to say, with none at all. Utwater, Atwater, Outwater, McMillan– it doesn’t matter. Call them all! Who cares if the first name is wrong or if it’s in another state or if you call six hundred times and they never answer?
Now there are some gaps in this theory. Utwater is not a common name, nor are any of the probable variants. So why would several dozen debt collectors pour hundreds of hours of effort into annoying someone from whom they won’t get any money? Meanwhile, the delinquent Atwater or Outwater or McMillan remains at large, probably running up even more debts in expectation of the Rapture.
Some mysteries will probably only be answered after our demise.
I have tried almost every means possible of getting rid of these people. I tried to talk with them, but the first experience cured me of that. The debt collector claimed to be searching for a person with my name at an address that would be in a park if it existed. On being told the correct address he was calling (something he might easily determined by looking at the phone book) the collector sent a claim for debt. The claim had no information about where or when or by whom or for what the debt had been incurred–just the amount. The original, eh, creditor was a shady outfit that ended up dancing with Eliot Spitzer, though I think it escaped judgement thanks to his personal indiscretion. I referred the matter to the State Attorney General of the debt collector’s state at which point the debt collector lost interest.
But the saga continued. Other debt collectors called, offering as evidence four digits of a Social Security number that were not mine. I copied the response to my state attorney general and the debt collector decided that perhaps discretion was the better part of valor.
More calls poured in, for Carlos Utwater, and Cameron Outwater, and Cinnamon Utwhistle. I gradually realized that answering the phone was not helpful. I got caller blocking, which allows one to prevent a particular number from calling, which definitely helped with the woman who used robocalling.
And debt collectors got more clever. They didn’t leave recorded messages. They blocked transmission of caller ID information, so that numbers came up as “Toll Free” or “Out of Area.” They spoofed their telephone number to make it seem as if the call were local.
And I got more clever. I started keeping a phone log. I learned to look up who was calling at sites like 800notes.com. I read the law on debt collection. I started filing complaints with the FTC and writing cease communication letters.
As described by some of the references given below, we are in an era where debt collectors– with no evidence whatsoever– can go to a court and get judgment entered against you. Many times the “debt” they are trying to collect is from lists of uncollectable debt that are sold hand to hand for pennies on the hundred dollars.
Debt collectors can and do lie to claim that they called you, that they sent notice of debt owed to you, that they served process against you. They can and do call your neighbors and your employer. For some employers, notably those who require security clearance, unpaid debt can get you fired. And most important, they can do all of this even if they just invented the debt.
Yes, that’s right. You can be sent to debtor’s hell even if you don’t have any debt whatsoever.
I could probably end my little annoyance fairly easily. At some point, I may do so, since I, not the debt collectors, are in control of this. But I recognize that what is going on is not my battle, but as our battle to keep this country from further degradation. As someone with no debt whatsoever, I am the perfect person to expose the criminality of this industry. The whole business of debt collection is profitable increasingly because it uses extortion, blackmail, and fraud.
Fraudulent collection is often not directed against genuine debtors–they don’t have any money! Fraudulent collection is being deployed against people who do have money, and therefore don’t have any debt. Yes, they are coming for you, comfortable, secure Mr. “Government IS The Problem.” Thanks to decades of assault against consumer protection, the federal response has been weak. Most states are even worse. There have been a few crackdowns on companies that threaten to break your legs. But the industry continues to become more and more the province of outright criminals.
Citizens, to metaphorical arms.
The legal situation
1. Debt collection agencies are required under the Fair Debt Collection Practices Act to provide written notice of debt upon demand. Congress, of course, couldn’t just require them to send a certified, return receipt statement to begin with. The consumer has to demand it. And, unfortunately, penalties are relatively small.
2. FDCPA forbids “the placement of telephone calls without meaningful disclosure of the caller’s identity.” This has been amplified by the Truth in Caller ID Act, with a $10,000 per instance fine.
3. The most serious tool is perhaps in the hands of the state attorneys general. Many debt collectors are engaged in fraud. They buy lists of uncollectable debt for 25 cents on the hundred dollars. That uncollectable debt may very well be completely fictitious. So the incentives to try to squeeze people in the hope that someone will cave– someone elderly, someone whose English is poor, someone unfamiliar with his/her rights, someone who needs to keep their credit record clear to, say, keep a security clearance. All of these people are vulnerable to being defrauded.
4. The federal government could pursue systemic fraud through its powers to regulate interstate commerce. We have seen how vigorously they have pursued investment banks.
Disclaimer: I am not a lawyer, even on TV. This is the result of personal research, and does not constitute legal advice.
Some articles on debt collection
Liz Pulliam Weston, MSN Money:
Lisa Burk isn’t Lisa Sterns, but Allied Interstate refused to believe her.
The Minneapolis collection agency repeatedly called Lisa and her husband, Michael, according to a lawsuit filed by the Minnesota attorney general, and demanded that the couple pay a debt owed by one Lisa Sterns. The couple, just as repeatedly, told the collector they didn’t know any Lisa Sterns and asked the company to stop calling.
Allied ignored the couple’s requests.
Because the old liabilities cost collectors as little as 25 cents for each $100 in face value, companies can make a profit if they can get debtors to repay even a tiny fraction. Along the way, some collectors realized they also could squeeze money from people who didn’t even owe it.
Some consumers pay because their finances are so disorganized they don’t realize the debt isn’t theirs. Others are coerced into paying by illegal threats of lawsuits or ruined credit.
Patricia Sabatini, Pittsburgh Post-Gazette:
Ms. Hillebrand said one of the most serious problems involves people not finding out they’ve been sued for repayment until the case is over.
While many consumers don’t respond to lawsuits, Consumers Union found that in many cases they did not receive the required notice from debt collectors that a lawsuit was pending.
When consumers fail to appear in court, the debt collector wins a default judgment, which “frequently requires little more than the name, address and alleged balance of the consumer,” according to the report, produced in conjunction with the East Bay Community Law Center in California.
To keep up with an explosion of lawsuits they are filing, debt buyers employ “robo-signers” who sign affidavits attesting that they have reviewed and verified debtors’ records, when in fact they may have only looked at basic account information on a computer screen, according to the report.
“An increasing number of consumers are being hounded by debt collectors for unsubstantiated debt,” Consumers Union said.