Who Hijacked Our Country

Friday, July 29, 2005

Sleazy Bill Collectors

We all know about the bankruptcy “reform” bill that was passed several months ago by the world’s biggest whorehouse Congress. And now for its ugly step-sister: debt collection tactics that you’d associate with loan sharks, or the debtors’ prisons of another era.

These collection agencies are debt buyers; they purchase unpaid bills from credit card firms. Some of these debts are so old they’re past the statute of limitations; there’s no legal ground for collecting the money, and the unpaid debt can’t even go into the debtor’s credit report. Hence the collectors have to resort to threats and blackmail.

As consumer debt has gone way up over the past few years, these sleazoid companies have increased accordingly. In 1996 there were about a dozen of them. Today there are more than 500.

And with typical Orwellian logic, the credit industry says these debt collectors are offering a valuable service to debt-ridden consumers: These deadbeats now have a chance to pay off their debts at a discount. Ooookay. George Orwell must be turning in his grave, saying “why didn’t I think of that?!?”

These collection agencies pay an average of 5.4 cents on the dollar for the debts they’ve purchased. They’re determined to make a profit with their collections — hence their Nazi Stormtrooper tactics. The Federal Trade Commission receives more complaints about debt collectors than any other industry. In the past four years the complaints have quadrupled to almost 60,000 a year.

These collection agencies don’t just go after debtors. If they can’t locate the person who actually owes the money, they’ll go after an estranged relative or even an unrelated person with the same name. One of these lowlife agencies made repeated calls and threats to a man whose daughter was in debt — she had moved out 15 years earlier. The debt collector recited the man’s Social Security number and his wife’s name, and said some of his “associates” would be paying a visit to teach them a lesson.

Another one of their greaseball tactics: they’ll persuade a debtor to make just a small payment. Then, from that payment transaction, the debt collectors can get enough personal information that they can keep withdrawing more money (illegally) from the debtor’s bank account.

One woman was hounded by collectors for a debt owed by her deceased mother. She wasn’t legally responsible for the debt, but she agreed to let them withdraw a specified amount from her bank account once a month. The collector tried to make several more withdrawals during one month; her bank charged her for bounced check fees each time this happened. Then the collector started calling her repeatedly at work, and told her he’d keep calling and calling until she lost her job.

Maybe our coin-operated Congress will crack down on these shady, slippery practices. Riiight.


Blogger halcyon67 said...

Since many of the debts owed are past the statute of limitations can't the person who is being harrassed sue for fraud and larceny?

I know people who do not pay their bills, so they screen their calls and have special ring tones set up to tell who is and who is not a bill collector.

Maybe our coin-operated Congress will crack down on these shady, slippery practices. Riiight.
^^Congress is probably working with these morons. Or they are the members in Congress. Seems a little unlikely, but hell, I can believe anything these days.

July 29, 2005 at 7:07 AM  
Anonymous Tom Harper said...

Samantha: Sure, these people who are past the statute of limitations could sue. But these bill collectors just prey on people who are too scared and/or don’t know their rights.

And no doubt, Congress is working hand-in-glove with the credit industry, every step of the way. At this point, our government, Big Business and the Church are all so tightly fused together, it’s hard to tell where one leaves off and the other begins.

July 29, 2005 at 9:54 AM  
Blogger Kate said...

As a person who once had an unpaid debt (a large medical bill), I can definitely relate to this article. The debt collectors were never satisfied. They would call anytime of day or night, and harass me to no end. Fortunately, I was able to pay the debt off and get them off my back. By the way, your blog is the Friday Featured Blog at my blog, Kate's Ramblings And Wanderings. Come check it out. There are also some buttons in the sidebar in the Friday Featured Blog section that you could use if you wanted to link back to the post I did on your blog. Of course, linking back is completely optional. :-)

July 29, 2005 at 12:07 PM  
Anonymous Tom Harper said...

Kate: Sorry to hear you were hounded by debt collectors over a medical bill. It's not like you got sick just to piss them off.

With this bankruptcy "reform," I guess collection tactics will just get more and more nasty.

Thanks for writing about me at your site (I left a comment over there). I have you linked.

July 29, 2005 at 12:29 PM  
Blogger Ken Grandlund said...

Great topic Tom- one that I've experienced myself.

Long story short- some dubious collection agency claimed I owed a debt (unverified by them and known to be false by me.) I told them to buzz off and when they didn't, I got a lawyer.

Everyone needs to know a few things. The federal Fair Debt Collection Act was passed in the 90's to protect consumers from these vultures. If you are harassed, here's what you do: (assuming you don't really owe the money.)

1- Send a certified letter stating clearly that they are NOT TO CALL YOU AT ANY TIME. Insist that all correspondance be written and mailed. Sending this certified will provide you with proof that they received the letter.

2- Keep accurate records of times they call, names of callers, and as much of the conversation as possible. Don't be afraid to tell them you are doing this for legal action against them. YOU HAVE THE RIGHT TO BE LEFT ALONE. Insist upon it.

3- Find a local lawyer who will work the case on a contingency, especially if the harrasment does not stop. You will still need to pay for hard costs (filing fees, depositions, etc) but these costs can be recovered if you go to trial.

4- Go online and find out about the federal consumer protection laws.

Stand up for yourself! The jerks who harrassed me have now been shut down by the FTC and the owners are facing civil and possible criminal sanctions. Seems they were running this scam nationwide and threatening people left and right.

July 29, 2005 at 12:33 PM  
Anonymous Tom Harper said...

Ken: Yup, you’ve got it. That’s exactly what to do. Last year we started an account with Cingular Wireless. After 2 months we were dissatisfied with their service and charges, so we canceled. They told us there was a $300 cancellation fee for “violating” a 2-year contract we never knew about. They sent us several bills for the $300 and we just kept ignoring them. Then a collection agency wrote to us. We sent them a certified letter detailing exactly what had happened: we had just moved, and we told the Cingular rep that we wanted to try out cell phones while we waited to get a regular land-line installed; we might or might not keep the cell phones after that. And the charges were much higher than what he’d said they’d be. We never heard from the collection agency again.

These firms just take advantage of people who don’t know their rights. If they strongarm 100 people, several of those people will buckle under. If they do this to thousands of people, they’ll make a fortune.

July 29, 2005 at 2:33 PM  
Anonymous JollyRoger said...

I have been contacted repeatedly over the years by Asset Acceptance Corp., trying to collect a bill my ex-wife ran up.

And even though relations with my ex are anything but cordial, I'd rather be run over by a truck than give these bottom feeders any information on her whereabouts.

July 29, 2005 at 3:29 PM  
Anonymous Tom Harper said...

Jolly Roger: Damn, there’s a quandary: an ex versus a bill collector. I’m with you — I’d side up with an ex any day. “Asset Acceptance” — what a nice, innocent-sounding name for a pit bull. George Orwell is more alive every day. It’s amazing how many people have had run-ins with these bottom feeders. They’re just lying in wait for anyone, anywhere, to make a mistake, and — Gotcha!! God, what lowlifes. If the government doesn’t crack down on these sleazebags, We The People may have to.

July 29, 2005 at 6:23 PM  
Anonymous Anonymous said...

Just like the bankrupcy bill, debtors are a very hard group to defend.


July 30, 2005 at 5:15 AM  
Anonymous Tom Harper said...

Erik: There are a lot of different circumstances for going into debt. Before this bankruptcy “reform” law, bankruptcy judges would differentiate between someone who got laid off with no notice or had a medical emergency, and someone who just lived it up, maxing out on all their credit cards and then declared bankruptcy. Now they’re all lumped together.

The credit card companies purchased this “reform” law from Congress, and they’re determined to get their money’s worth.

July 30, 2005 at 8:54 AM  
Blogger Unadulterated Underdog said...

This is the reason I'm working on consolidating my credit cards into my student loans and having done with them. Credit cards are a rip and I want a clean start after college, not a struggle to pay my debtors. I have $1400 in credit card debt so if I add that to my student loans, I will owe about $10,000 total. With the low interest rate on loans, I can pay it all off at $100-$200 a month and be done with it in 5-10 years without having to struggle with it too much. I don't intend to get mixed up with credit card crap much ever again. I might keep a Visa card with about a $2000 limit so I can use it to book my plane tickets and other things but I will only spend what I can then pay back out of my bank account. Credit cards are a trap that I do not want to mess with.

July 31, 2005 at 3:13 AM  
Blogger Nariel said...

Well.. I've had my share of credit problems without a doubt and had catastrophic medical bills following the birth of my first child. When they continued to harass me.. I emptied my penny jar in an envelope and delivered it to the Oxygen Company that needed their 30 bucks that was still owed them, more than my child needed diapers that week. They got about 10.00 in pennies/ They never called me again after that day. :0)

The problem as I've seen it for myself and as I and Kevin dealt with it: CEASE ALL CREDIT ACTIVITY. If we do not have the money, we do not buy. If we do not have the CASH (not check mind you) we do not buy. I don't miss my credit cards--and I don't miss my checkbook and bankcards.
I prefer the life of cash and carry only.

For some that's mighty hard to do, but I assure you..its not impossible. As the Nation continues the way it is... the less i want to do with all their systems--credit cards and banks were two of them that could go just like *snap--that*

July 31, 2005 at 7:12 AM  
Anonymous Tom Harper said...

OK Liberal: You’re right about that. Credit cards are a trap. The only card we use is AmEx, where you have to pay everything back the next month. We have a Visa card just to show for plane tickets, car rentals, etc. It’s good that more people are getting educated (I learned the hard way too). These people are the same as loan sharks — they’re always right there to prey on somebody who’s in a desperate situation and might make a dumb decision.

Nariel: Hey, that’s pretty good, paying them off in pennies. I used to take the free-postage return envelopes from all those credit card solicitations and cram as much confetti inside as I could and mail them back. The envelope would weigh at least 3 times as much as the legal weight for a first class stamp, and they’d have to pay the postage on it.

We now have the same approach — nothing on credit. If we don’t have the money we don’t buy it. We learned this the hard way. The less you have to do with banks, the less impact it’ll have on you when the banking industry collapses (and I do believe it’s when and not if).

July 31, 2005 at 12:10 PM  
Blogger Nariel said...

Tom: totally agree on the collapse of the monetary system as it is now. I fully expect that there will come a time when they will attempt to get us into a "one currency for the globe" frame of mind.. i know, call me a conspiracy theorist.. but aren't our bills already dramatically resembling euros??

July 31, 2005 at 12:32 PM  
Anonymous Tom Harper said...

Nariel: Yeah, I wouldn't be surprised at a global currency. Even without that, the banking industry just seems too much like a house of cards. All the precautions and firewalls that we've had since the 1930s are being thrown out because they're too inconvenient for bank executives.

If it collapses, our tax money will bail out the CEOs and we'll be left holding the bag.

July 31, 2005 at 1:45 PM  
Blogger Kitchen Window Woman said...

Very enlightening. I wasn't aware of the problem with the collection companies. We put all of our debts under a consumer creditors agency some years back and paid them all off that way. The company did the dealing for us and divided a monthly amount between the bills that we owed. We do most dealings with money that we have in hand. It is nice to be "out from under".

July 31, 2005 at 2:23 PM  
Anonymous Tom Harper said...

Kitchen Window Woman: We got out from under several years ago too, with a consolidated loan. It wasn't easy, but now it's cash or we don't buy it. That's what everyone should do.

These loansharks and collectors and other vultures are always lurking out there, just waiting for someone to make a bad decision or let their guard down for a second.

July 31, 2005 at 4:12 PM  
Anonymous Anonymous said...

Hey Tom,

I've included a link from a great article in the SF Chronicle on Credit Card rates. Basically shows they are going up for every reason.



July 31, 2005 at 5:21 PM  
Anonymous Tom Harper said...

Erik: Thanks, I'll check it out.

July 31, 2005 at 7:49 PM  
Blogger Danica said...

nice topic..a truly attention-grabbing blog..

July 31, 2005 at 8:16 PM  
Blogger The Bulldog Manifesto said...

Credit cards are akin to voluntary serfdom. I wont have any part of it. Its either cash, debt card, or nothing. No credit card.

July 31, 2005 at 8:45 PM  
Anonymous Tom Harper said...

Danica: Thanks.

Bulldog Manifesto: Voluntary Serfdom, that's a good description. One wrong decision at a desperate moment, and you're a serf for five years.

I never quite reached the Serf stage, but there've been some learning experiences. Now it's cash or nothing.

July 31, 2005 at 10:03 PM  

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