COMPUTER GENERATED LAWSUITS TARGET CONSUMERS
It’s bad enough that debt collectors often harass consumers for debts they don’t owe. But now, tens of thousands of computer-generated debt collection lawsuits are being filed against often-innocent consumers.
Here is what is happening.
The New York Times reports that debt collection law firms are now using software to create and file collection lawsuits with no regard for whether the people they file against really owe the money.
Months ago, we alerted consumers about the zombie debt collection industry. It’s called zombie debt collection because firms buy old debts that were written off years ago,The debt collector often buys only the name of a consumer the company alleges had a bad debt. The zombie debt collector then targets any consumer with a like sounding name anywhere in the country, often shaking them down for debts they never owed.
What is really scary for consumers is that now the zombie debt collectors use law firms that generate cases on computers and never bother to do any background work on the lawsuits they file. They merely take a name from a zombie debt collector and have a computer file the case. Do they pick up the phone and call the consumer to check if it’s the right consumer? NO. Do they call the bank and ask for the original file on the debt? NO. Do they cross check to see if the consumer they file against actually had a credit account, much less a account with a debt? No.
One law firm in New York with only 14 bottom feeders working has filed 80,000 consumer debt cases, often against innocent consumers.
Ok, all bad news. But here is the good news for consumers: one judge in New York, Judge Noach Dear, is demanding that lawyers actually prove that the person they are suing is the right person. Kudos to him.
Meanwhile, the state of North Carolina has a new law that says all lawsuits targeting individual consumers must actually have proof of that debt.
I-guy has this advice:
1. Never ignore a collection letter, even a bogus one.
2. Fight back; demand proof of the debt, and demand it in
writing. Never call the collection attorney.
3. If an attorney comes after you for a debt that is not yours, go
after the attorney. File a complaint with the bar association, file
a complaint with the FTC, and file a complaint with the BBB.
Make the attorney the issue.
I got your back