Do you have a secret fear about being sued for credit card debt? Read on…
A 2013 Reuters article featured on the Pittsburgh Tribune website reported a multi-state investigation by a group of government attorneys general of the too-big-to-fail banking companies, Bank of America, JPMorgan Chase, Citigroup and Wells Fargo, as to whether they helped junk debt buyers pursue faulty judgments against consumers with defaulted credit card debt.
JDBs acting as credit card debt collection agencies have caused so much controversy because of the way they are threatening people into settling credit card debt that lack proper documentation. Consumers get sued for credit card debt that do not have enough documentation and incurring the ire of the prosecutors. What makes it worse is that these sued debtors also do not fight the lawsuits because of lack of knowledge on how to deal with it and couldn’t find appropriate help with credit card debt. According to the Reuters article,
“At issue is whether weak record-keeping by banks or a failure to pass accurate information to collection agencies harmed consumers . . . . The allegations against the banks echo those central to last year’s $25 billion federal-state mortgage settlement to resolve charges that the banks “robo-signed” documents and pursued foreclosures with faulty information. Investigators are finding that the banks often did not provide buyers of the debt with evidence that individual credit card accounts were delinquent. Instead the banks only provided basic information about how much money they thought was owed and who the borrower was, without providing original contracts, past statements, or other additional documentation.”
This local TV news station video clip reports on the same problem.
Consequently, junk debt buyers are tying up government courts with credit card debt lawsuits that have no or insufficient documentation to win a judgment. Last August the Atlanta Journal-Constitution reported “collection companies are churning out flawed lawsuits [in Georgia courts] to collect credit card debt, angering judges . . . . Judges complain that these lawsuits are so scant that the company cannot prove its case. But only a few are thrown out. In fact, most of these cases win in court because the great majority of people simply don’t fight them.” For a lot of judges, this situation is frustrating because they are prosecuting people who may not be guilty but still receive the bad end of the lawsuit. JDBs on the other hand win the lawsuits simply because the accused do not fight. The New York Times reported similar problems with documenting credit card debt for court actions August 2012 in Problems Riddle Moves to Collect Credit Card Debt.
The Journal Constitution reported Wayne Purdom, chief judge of the state court in DeKalb County, “counts himself among the more stringent judges on evidence. He said he’s frustrated by the incomplete records and often generic testimony from witnesses called by the debt companies. ‘People testify about records when they are not familiar about what’s in them,’ Purdom said.” According to the Journal-Constitution, a new Georgia evidence code approved by state lawmakers took effect in January and is expected to tighten the evidence requirements. The state of Maryland passed a similar action a few years ago in response to similar junk debt buyer abuses of the government legal system.
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