Debt Collectors and Harassment
Let’s face it: In many senses there has been a perfect storm of credit availability, and mismanagement of funds that has left a large swathe of the country in debt. Some of the weakest and most venerable members of our society have become the victims of mounting debts, the frustration that comes with it, and the painful event of having to deal with debt collectors.
While there is little doubt that many who collect debts do a service that is invaluable and go about their business in a professional and courteous manner; there are also those who simply believe that it is their right to belittle and harass a person into paying off the bills.
A recent example of this that made national news and brought an extremely unfriendly light back onto the debt collection industry was the case of wounded combat veteran Michael Collier, who having served honorably in the military was discharged with 100% disability after being injured in the head and spinal cord.
These injuries made it virtually impossible for Michael to pay on his obligations, most notably his student loans. A series of bad decisions on the part of the credit collection agency followed, culminating in them violating a judge’s order and eventually subjecting this war hero to an abuse laced tirade over the phone.
While the case of Michael Collier has caught the national spotlight, and there is little doubt the firm will now be investigated by the attorney general of their state, this is not a unique story in the arbitrary manner in which collection agencies go after those who have a debt. Age, injury, or mitigating circumstances mean nothing to these individuals who see this as a weakness they can exploit and use as a psychological advantage in the hopes of getting a commission.
The situation has gotten to a point where state attorney generals, the Federal Trade Commission, and the Consumer Financial Protection Bureau have identified debt collectors as a very real and virulent threat to the livelihood of consumers and to the American justice system as a whole. In and of itself these are very serious indictments of the industry.
The FTC, however, goes even further stating that the number one complaint it receives are from consumers who have been the target of debt collectors. In a significant bench mark, over 10% of complaints received by the FTC were from people who had been targeted by unethical practices used by the debt collection agencies. The FTC Top Complaint Category for 2011 can be found on their site here.
The Federal Trade Commission has very clear guidelines set in place by the legislature for the governance of debt collection. This means that, regardless of their own opinion, debt collectors are required to play by a certain set of rules. Behavior that is considered intimidating, threatening, or otherwise profane is forbidden, though frequently ignored by overzealous employees at these companies who typically work on a commission basis. Here are some practices that are off limits to debt collectors as listed on the FTC’s website.
- Use threats of violence or harm;
- Publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
- Use obscene or profane language; or
- Repeatedly use the phone to annoy someone.
- Debt collectors may not lie when they are trying to collect a debt. For example, they may not falsely claim that they are attorneys or government representatives;
Under the Dodd-Frank Wall Street reform act, the Consumer Financial Protection Bureau will have far more sweeping powers to investigate abusive practices by debt collectors. That being said however, for the everyday consumer who is being plagued by unsavory phone calls, harassment, and abusive treatment at the hands of a debt collector the legislation can seem very far away. Solutions need to be found at a more local level, with attorneys who can get into the equation quickly and make a lasting impact both on the client and on the agency that is engaging in bad collection practices.
Have you been harassed by a debt collector?
How do you think this situation should be handled?
Article Written by Lili Miller
Bio: SimplyLili is a PhD student in Social Psychology, and the witty author of Essell Magazine; created to disperse knowledge on a plethora of psychological topics in a minimalist and relevant way. She is a self-proclaimed nerd and her 3 fave things are blogging, rainy days, and pugs.