Archive for the ‘Debt Collection Methods’ Category
When the Fair Debt Collection Practices Act was enacted in 1978, social media sites like Facebook and Twitter did not exist. No one could have anticipated how much of an impact social media would have on our lives but the debt collection industry is taking full advantage of our lives on public display.
MSN recently interviewed consumer attorney Craig Thor Kimmel for a story about how debt collectors use social media sites to contact consumers or gain information about them. Read the story on MSN here: Facebook, a debt collector’s friend
The following are useful strategies from that article to pre-empt unwanted calls or other communication from collectors:
1. Respond within 30 days of receiving a collection letter. For many people who receive a letter from a collection agency, the impulse is to bury their heads and ignore it. That’s a mistake. All you have to do is send them a letter within 30 days and tell them, ‘Do not contact me anymore through any method.’ They can still sue you for the debt, so the act of collecting doesn’t necessarily stop, but they can’t send you emails or call you anymore.
2. Use those privacy settings. Setting your profile to private reduces the likelihood that a collector has access to your wall or photos.
3. Be selective about what you post. Social networks like Facebook can create a false sense of intimacy because you’re communicating with friends. Even with a private profile, your friends’ accounts could still get hacked or someone could be peeking over their shoulder, so it’s smart to err on the side of privacy. Debt collectors use social media profiles to look for an address or employment information. A lot of people put what their occupation is, where they work, cellphone numbers.
4. Don’t accept friend requests from strangers. For reasons described earlier, don’t approve requests from people you don’t know. It could be a friend of a friend, but it could also be a collector or spammer.
5. Skip the “like” button. Liking your bank or credit card issuer on Facebook may open the door to the company collecting information about you that you haven’t given them.
If, despite these steps, a collector contacts you via a social media site, Kimmel suggests printing out the message or saving a screen shot to your computer to create a paper trail. “Once you have that, report the sender as spam on Facebook and file a grievance with the Federal Trade Commission,” he suggests. The consumer could be entitled to up to $1,000 plus legal fees and actual damages “if a debt collector engages in unauthorized debt collection contact, through, for example, social media,” says Kimmel, adding that a consumer attorney could help the person seek redress.
Debt collectors have been known to use various techniques to secure payment, some of which violated the Fair Debt Collection practices act (FDPCA). This can include pestering debtors, their friends, relatives and co-workers with calls at inappropriate times and places. In other cases, debt collections for debts of the dead, can rise from the grave too, but in ways that they shouldn’t. Debt collectors have been known to call loved ones and others to pay off the debts of their dearly departed. Is this outrageous? We think so.
Aside from being callous, post-mortem debt collector calls are deceptive as relatives of the deceased are typically not responsible for the debts, unless the debt was joint among the deceased and the living. Playing on the lack of knowledge of the average consumer, and perhaps believing that the memory of the deceased would be tarnished in some way, debt collection agencies will call relatives and try sympathy tactics to convince the living that they should or must pay off a debt. The debt collector may not actually inform the bereaved that they have to pay the debt, but they will read from a script that is convincing enough to give that impression and to omit the fact that the living are not required to pay it.
Debt collection agencies justify such tactics with a cold heart and insensitive mentality, taking advantage of loved ones still saddened by the passing. Consumers beware: in the vast majority of cases, you need not pay the debt of someone who has passed. Check with a good consumer lawyer and find out how to protect yourself and to stop this practice.
In most cases, people who receive collection calls accrued the debt themselves and have fallen behind on their payments. In some instances, however, these charges are a result of identity theft. Because people rely on technology to pay bills and make banking transactions, it is important to stay protected against hackers and Internet fraud. The best way to avoid collection agency harassment is to reduce the risk of having your identity stolen in the first place.
Consumers who use debit cards should check their account activity frequently. Every major bank has an online banking option which makes it quick, convenient, and free to monitor checking accounts. Anyone who comes across questionable or suspicious transactions on their statement should contact the bank as soon as possible.
Credit cards are better protected against fraud. Therefore, they should be used for online shopping and other Internet transactions instead of debit cards. Information shared online runs the risk of being stolen by hackers and used without your knowledge or consent. Again, people who suspect their accounts have been used fraudulently should contact the credit card company immediately.
Collection calls only begin once payments have not been made for a significant amount of time. Regular credit checks are a surefire way to stop theft in its tracks. Some criminals can open new cards in the victim’s name; in some cases, the only way a person knows that this new account exists is by seeing it on their credit report. Credit scores are very sensitive to missed payments, and even a fraudulent card can have a negative impact on your score for a while.
It is important to understand why collection calls feel like harassment in order to deal with the stress they create.
Many Americans have fallen behind on their credit card, mortgage, and/or car payments because they have experienced some form of financial difficulty. This causes stress on the individual, as well as family and friends that are affected. To make matters worse, collection agencies are making harassing collection calls about past-due accounts on a daily basis. These agencies use fear tactics on vulnerable people for one purpose: to make money.
When a consumer falls behind on their payments, creditors often retain debt collectors or sell the debt to them for a fraction of the total debt. Now, it is up to the collection company to turn a profit for themselves by collecting as much money as possible. It is typical for these agencies to pitch a “deal” to settle for less than the original debt; in fact, they are still making a profit because they bought the debt for far less. This is when the debt harassment starts.
Debt collectors will often use threats and lie to the consumer to try to force a payment out of them. They will up the ante even further to squeeze as much money out of the person as they can. This causes added stress and anxiety on the consumer who is already overwhelmed by their finances in the first place. Even though some of the tactics they use are unethical, collections companies continue to use them for financial gain.
It is important for people in this situation to remember to stay calm. Many of the intimidation practices used by debt collectors calling the home or office are empty promises. If the threats feel like harassment then an experienced debt collection lawyer can help you learn your rights and stop the deception once and for all. Otherwise, taking positive steps to get out of debt is the best way to stop collection calls.
While millions of Americans must grapple in this difficult and topsy-turvy economy, some businesses continue to thrive. In fact, Portfolio Recovery Associates, Inc., a company that purchases, collects, and manages consumer debt, are reporting record-breaking profits.
Portfolio Recovery Associates, like other debt collectors, makes money by purchasing consumer debts from creditors, banks and other financial institutions. As defaulted debt or late pay debt increases, buyers and debt collectors like Portfolio Recovery Associates see their revenues rise as well. From 2009 to 2010, Portfolio Recovery Associates experienced increases in net income of 66% from $12.4 million to $20.6 million. At the end of their fourth quarter of 2010, Portfolio Recovery Associates’ total revenue rose 38% from 2009 for a record $100.8 million.
Isn’t it ironic if not more than a little bit aggravating that the success of debt collectors, like Portfolio Recovery Associates, has a banner year while most Americans struggle with loss of income, jobs and being choked by debt? Debt collection and debt buying are not on recession proof; they are recession successful. As Americans fight to pay off accumulated debt, collection agencies flourish.
Of course, someone needs to do the collecting, it is just that when collectors deal with so much business in response to market conditions, it makes one wonder if the abusive behaviors consumers complain about will rise as well and/or if all the FDCPA protections are being complied with . The next time you receive an aggravating or uncivil collection call, remember that you have rights, and you don’t have to tolerate abuse.
Are you experiencing debt harassment? Collection agencies often prey on consumers. Why? Because it is in their best interest to scare consumers into paying. Creditors often use collection agencies to recover funds on delinquent accounts. The collection agencies are handsomely paid for their services, which often involve nagging collection calls and a barrage of written notifications.
Are you aware of your rights as a consumer? Have you heard of the Fair Debt Collection Practices Act and debt collection laws? You don’t have to be intimidated or anxious about your limitations in knowing the law. Help is available. To start, view the video to become more aware of tactics employed by credit collectors.
Debt harassment attorney Craig Thor Kimmel speaks with Jim Donovan from CBS Philly about the abusive practices of debt collectors:
Unmanageable debt has become a way of life for a majority of Americans. Even as our government struggles to survive its own massive deficits, it is not surprising that we as individuals often have difficulty meeting our credit card payments, mortgages and car loans, especially when interest rates and bank fees are designed to keep consumers deep in debt. The fact is that our economy encourages people to live with too much debt, in ways that cannot be repaid in a lifetime. We are encouraged to buy more than we need and to pay for it later by use of credit cards, mortgages, student loans and car payments. Even with the best of intentions, unforeseen things can happen. Yet, we all need to survive and must provide for our families, even if it comes at the cost of not knowing how to pay for it until later. And so, money issues can get out of control, even more so when something unexpected happens. It can be the result of an historically bad economy, divorce, death or illness of a wage earner, or job loss. Debt increases throughout life and causes major stress.
If paying your bills has become difficult, your accounts have likely been sent to collections. Collection departments and debt collectors are the tools used by banks, mortgage companies, auto lenders and credit card companies. These same businesses that encouraged you to buy, to pay later, assault you with collection harassment demands to pay immediately, by any means necessary; and when people don’t pay immediately, that’s when things go from bad to worse. Collection departments and debt collectors specialize in pressuring you to pay and pay and pay, often resorting to harassment, threats, abuse, deception and occasionally filing lawsuits, until they get what they want. In far too many cases, the actual amounts being sought changes considerably, growing far greater than the amounts actually owed without any justification. In other cases, the debts are too old to be collected, but that does not stop the collection industry from pushing as hard as possible, knowing that good people want to pay their bills.
If you find yourself being called by a debt collector, the chances of you being the victim of collection agency harassment is far greater than you may think. Americans are contacted by debt collection agencies every year, in many cases several times a year. However, there are steps that one can take in order to stop the harassment, and to be certain they do not pay anything more than they actually owe. In many cases, people can drastically reduce and even eliminate the debt they have. A lot of debt claims can be defended, more often than you think.
One of the key points to getting out of debt and avoiding collection harassment is to manage your money effectively, but once you are already having trouble, you need help. Getting debt help starts with gaining knowledge on managing your income and expenses, keeping a tight rein on unnecessary spending and eliminating erratic behavior. It also means cutting back on offers of credit and not using cards that charge excessive interest and fees. The removal of debt harassment in your life, whether you are experiencing it for the first time or have been dealing with it for years, is achievable through calculated steps to keep your money and life in order.
In 2008, Portfolio Recovery Associates Inc. was sued for fraud after affidavits were submitted bearing the name of Martha Kunkle, who died in 1995.
It appears that Martha Kunkle has come back to life. Last July, lawyers for Portfolio Recovery Associates sought judgment in a lawsuit against a Seattle woman for $2,892.10 in credit-card debt and interest that she allegedly owed. It was a fairly standard debt-collection case except that Portfolio included an affidavit signed by Martha Kunkle to vouch for the debt’s validity.
A spokeswoman for Portfolio Recovery said the document was “inadvertently used by our outside counsel” because of “human error,” adding that the suit was dropped later “upon review of the case.” She also stated that Mrs. Kunkle’s name does not appear on any other affidavits submitted in other cases.
This practice of robo-signing, in which affidavits are signed without fully reviewing underlying documentation, is more common in debt-collection cases than foreclosures.
Minnesota Attorney General Lori Swanson is investigating numerous debt buyers debt collectors for this practice of falsifying affidavits. Missouri Attorney General Chris Koster said he wants to investigate whether Martha Kunkle’s name appears on any affidavits used to collect debt in the state of Missouri.
Concerns about Ms. Kunkle’s affidavits were raised in 2008 by lawyers for Jeanie Cole, one of thousands of Montana residents sued by Portfolio Recovery Associates to collect debts. After failing to locate Ms. Kunkle, lawyers for Ms. Cole interviewed her daughter, who worked at Providian in a document-processing division. Providian National Corp, a credit-card issuer, sold a number of delinquent account balances to Portfolio Recovery Associates and other debt collectors, which then sued the borrowers to collect the debt.
The daughter testified in a deposition that other Providian employees used the name Martha Kunkle when signing affidavits. Along with other employees, the daughter was responsible for signing affidavits. After counter suing Portfolio Recovery Associates for alleged violations of the Fair Debt Collection Practices Act, Ms. Cole was the lead plaintiff in a 2008 federal-court suit in Montana alleging the company targeted 16,000 borrowers using “false and misleading” affidavits.
Article Source: Dead Soul Is a Debt Collector
A former JPMorgan Chase employee is suing the company for wrongful termination but more importantly she has filed a whistleblower complaint with the SEC. The allegations charge JPMorgan with robo-signing, which is the automatic generation of documents such as foreclosure notices without a notary or following the legal process, among other illegal practices.
The former employee, Linda Almonte alleges the following:
1. Chase Bank sold to third party debt buyers hundreds of millions of dollars worth of credit card accounts. . .when in fact Chase Bank executives knew that many of those accounts had incorrect and overstated balances.
3. Chase Bank executives routinely destroyed information and communications from consumers rather than incorporate that information into the consumer’s credit card file, including bankruptcy notices, powers of attorney, notice of cancellation of auto-pay, proof of payments and letters from debt settlement companies.
4. Chase Bank executives mass-executed thousands of affidavits in support of Chase Banks collection efforts and those Chase Bank executives did not have personal knowledge of the facts set forth in the affidavits.
5. When senior Chase Bank executives were made aware of these systemic problems, senior Chase Bank executives — rather than remedy the problems — immediately fired the whistleblower and attempted to cover up these problems.
To support her claims, Almonte says she has “a large volume of documents in her possession available for review by the SEC” and offers her first-hand observations as well.
Almonte’s attorney issued the following statement:
“On numerous occasions, Ms. Almonte witnessed these Affidavit Signers work through at times 3-feet tall stacks of Judgment Affidavits at once during weekly multi-hour long, non-related company meetings. The notaries were not present at these meetings. The Affidavit Signers simply relied on hourly workers to reconcile amounts owed and then treated the actual execution of the affidavits as busy work to be performed while the Affidavit Signers could focus on other matters.”
Article Source:
Chase Hit With SEC Whistleblower Complaint Over Credit Card Practices
A Delaware County woman claims that a malicious human being – and not a computer program – is behind the erroneous $286,651,237 credit-card bill that Capital One sent her last year, according to a lawsuit filed last week in Philadelphia court.
Now, Patrice Perry, 58, is suing Capital One for that same ridiculous amount for the months of harassment and “terroristic debt-collection methods” that she suffered at their hands, according to the suit.
Her attorney, Craig Kimmel, said that the nine-figure bill that Perry received in August was the final straw.
“It’s not that different from going up to someone’s house, knocking on the door and punching them in the face when they answer,” he said.
Perry’s troubles started in May 2009, when Capital One began trying to collect an alleged credit-card debt from her, according to the suit. The company not only called her at home and at work repeatedly, it also called her family and co-workers, the suit said.
Perry, a hotel clerk from Clifton Heights, received a series of bills, the first of which claimed that she owed $4,807, Kimmel said. The second bill, which came more than two months later, said, without explanation, that she owed about $100 less, according to the suit.
Kimmel said that his client never paid the first bill and was confused when the second one dropped in price. The third bill, received on Aug. 11, 2009, was $13 more than the first bill, again without explanation or a list of how the charges were calculated.
“It’s not your typical scenario, where you’d expect if they were pursing debt with interest it would only go up,” Kimmel said. “It went down and up and down and up. The only thing I can associate with that is that they were trying to confuse my client.”
If Perry was confused after the third bill, she was dumbstruck when the fourth arrived for $286,651,237. Capital One asked that payment be sent in an envelope included with the bill and threatened to pursue legal action if she didn’t pay.
“She was shocked, she had never seen a letter with such a big number on it before,” Kimmel said. “And to demand she put the money in the envelope included and send it back . . . Phew!”
Kimmel said that a bill that large would most likely have been flagged and that human beings, not computers, are behind it.
In a written statement, a Capital One spokeswoman doesn’t deny that claim.
“There are very rare occasions when human error has led to inaccuracies in customer billing letters,” the statement read, in part. “This is clearly one of those instances. . . . We are working to resolve this issue.”
Kimmel said that Capital One sued Perry for a lesser amount, but when no one from the company showed up for a hearing this spring, the case was dropped.
The last communication Perry received from Capital One was last week, when she got a letter that, without mentioning the last bill for more than $286 million, states that she now owes around $6,000, Perry said.
Article by:
STEPHANIE FARR
Philadelphia Daily News
farrs@phillynews.com, 215-854-4225
Original article here: What’s in her wallet? Well, not $286,651,237
Related Articles following this story:
Boston Herald
Courier Post Online
The Consumerist
