Comment by Jennifer Bellworthy on February 5, 2011 at 11:43pm

Why isn't there a link to the original report?  It can be found at:

 

http://www.defendyourdollars.org/pdf/Past_Due_Report_2011.pdf

Comment by Jennifer Bellworthy on February 6, 2011 at 12:34am

Brett:  You state, "More importantly we need to also acknowledge that those individual problems have consequences to consumers and that the debt buying industry does owe the consumer our willingness to create a more fair system."

 

I find that intriguing.  What, in your view, would be a "more fair system?"  There not many good suggestions on this topic, and I am currently writing an article on this issue and would value your input.

Comment by Howard B. Weber on February 7, 2011 at 9:40am

The burden has clearly been placed on the collectors and not on the debtors. Debt buyers who are circumspect in purchasing verifiable debt are now subject to additional requirements by courts in various jurisidictions. Debtors who owe money and fail to respond to lawsuits, are benefitting from judges who require every piece of documentation throughout the transaction's history before they will award a default judgment. Sanity would suggest a showing of the transfer of the account, a signed application/lease, and an account history--many courts are now requiring proof of consideration for the purchase, individual signed charge slips, proof of repossession costs including appraisals, etc., all to justify entry of a judgment to which the debtor has not even objected. The industry leadership and the CPFB need to meet to clarify and streamline the process so both sides, creditor and debtor are treated fairly, and to establish agreed upon criteria so there is some unformity in the handling of these cases in our court system.

Comment by Gurn Blanston on February 7, 2011 at 10:28am

The burden of proof always falls on the plaintiff.  As for defaults, these consumers are often times not served properly and the debt collectors lie about service.  The consumers don't even know they were sued.  However, even when this happens the judge is required to ensure there is a prima facie case.  It is called due process.

Comment by Howard B. Weber on February 7, 2011 at 11:16am

And when due process is given, and the debtor knows full well they are being sued (and owe the debt), at what point does the burden shift to the debtor? Obviously plaintiff's must make out a prima facie case, but if I sell widgets and there is a default, I only need to have an affidavit from the creditor indicating the nature of the debt, the amount of the debt and describing how multiple bills sent to the debtor have gone unquestioned. But if I've purchased the debt from the widget maker, in addition to showing evidence of the purchase (which is fine), I am now held to a much higher standard to prove the same debt. Is there no due process for debt buyers??

Comment by Gurn Blanston on February 8, 2011 at 10:04am

The burden shifts to the debtor once you establish a prima facie case.  But unquestioned does not establish a debt that is owed.  And I am unclear what this higher standard is that you claim you are held to.  What does that mean?  What is an example of this higher standard?

Comment by David Mertz on February 9, 2011 at 2:20pm

I posted this on another thread and I think it is applicable here so i am going to repost. 
And, while I appreciate the legal discussion above, there are more fundamental issues.  Blaming the debtor - which is another theme going through this thread - is an excuse to address real systemic issues.  Behavior by many in the industry has been sufficient to do something which is very interesting - public sentiment has shifted from the debt owner to the debtor.  Whose fault is that?

As someone who works in the industry and has observed the industry up close and afar, I keep hearing the same old excuses for regulatory scrutiny.  A few rogue collectors.  Attorneys who make a living at our expense. We are unpopular and we are an easy target.  Blah Blah Blah.  Heck, I have even used them myself!

It's like Nero playing the fiddle as Rome burns.

Peggy Twohig, former FTC attorney, spoke at DBA in Feb 2009.  She mentioned being in a meeting with a large number of congressional staff.  Every person in the room had a complaint about debt collection activities which impacted either themselves or family.  This is not just a rogue collector, people do not like us, or we are easy targets.  Something else is going on. 

Why is this?  Is it because of a few text messages, phone calls, or a rogue Buffalo collection agency?  No.  If this was the problem, the trade associations would be able to work with congress and the FTC and find some happy middle ground.

If you want to undestand the issues, go look at the issues raised by the FTC's settlement with Chase/Bear Stearns/EMC Mortgage in the fall of 2008.  Peggy Twohig said this was the most important enforcement action taken by the FTC in 2008 and was a the roadmap for future FTC enforcement.  The foundational issue - and the first issue listed in the complaint - is data integrity issues (chain of title, accuracy of data, and collecting from the correct debtor).  There is nothing more foundational

Comment by Brett Sivits on February 9, 2011 at 2:38pm

The comments so far have been great and in effort to keep this important conversation alive I would say this.   I think its time to get rid of the excuses that Mr. Mertz so adbtly pointed out above and make customer satisfatiction our issue.  It's not that those excuses may not be real but trumpeting them obviously hasn't made an impact.

 

We need to take the issue back from regulators and consumer groups and make them our own.  Why does the trade associations only seem to be working with the regulators why are they not being proactive and working with the consumer groups.  I was excited to see the introduction of Ask Dr Debt by the ACA and look forward to more proactive approaches.  

 

These Consumer Groups have the perceived moral authority and like Bill Clinton in the 90's its time to take their issues and make it our own.  As Dick Morris, father of Clinton's triangulation solution, said "The essence of triangulation is to use your party's solutions to solve the other side's problems. Use your tools to fix their car."

 

Imagine the press releases and the coverage a joint report between the major trade associations and a few of these consumer protection groups.  The regulators will be left holding the bag.

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