When a debt collector attorney confronts you with a photocopy of your signed credit card application, a copy of a generic, unsigned credit card agreement and a few of your past credit card statements in a credit card lawsuit, what do you do? Without thinking, you could mistakenly admit to the debt, but this will not help you win against credit card debt credit lawyers. Because, in today’s legal environment, without your admission, his documents will not be strong enough to get him a judgment against you for the debt you owe.
You Can Win When There Is Poor Documentation
Last June, a New York judge threw out JP Morgan Chase Co.’s lawsuit to collect a few thousand dollars in credit card debt from a New York consumer. According to American Banker, the judge described as “robo testimony” the statements of the bank’s document custodian — a 17-year Chase veteran — and made it clear that he believed Chase had failed to present evidence to support the accuracy of its own records.
Could the above be the emergence of a trend in credit card debt similar to the nationwide robo-signing mortgage scandal?
American Banker says, ”. . . a growing number of judges, state attorneys general, federal agencies, consumer attorneys and academics are concluding that banks may be susceptible [to poor documentation] in other areas of consumer lending, including the credit card market.” If banks prove unsuccessful in defending themselves from claims that their records are shoddy, they run the risk of inviting a new regulatory crackdown and legal battles over the validity of claims involving tens of billions of dollars in unsecured [credit card] debt, concludes American Banker.
Those photo copies of a signed application and agreement and the print outs of computer
It appears, given the way banks run their credit card computer operations, personal knowledge of any one credit card account does not actually exist. We wonder what the ratio of credit card accounts to bank employees involved in credit card operations is; 1,000 to 1, 5,000 to 1, 10,000 to one? How can any one person have personal knowledge of that many accounts? . . . The answer is they cannot.
If credit card banks cannot document defaulted debt to legal standards, what does that mean for consumers who have defaulted on their credit card debt and live under the threat of a credit card lawsuit.
If you cannot settle credit card debt yourself and are worried about debt collectors, then best you learn how to win against credit card debt lawyers and debt collectors.
Debt collectors threaten consumers with credit card lawsuits for credit card debt they cannot afford to settle. If or when a summons for credit card debt does arrive most consumers do not respond because they know they owe the debt, so they conclude they have no defense and suffer a default judgment.
But now given recent developments, if they do respond and demand the junk debt buyer or even the original credit-card-bank creditor legally document their credit card debt, they will probably make the lawsuit go away.
JP Morgan Chase Co.’s robo-signing problems (see Part I) have American Banker concluding, “With the template for challenging collection procedures already established in the mortgage market, a broad attack on banks’ debt collection practices in other areas of consumer lending could expand rapidly.” Excerpts from the American Banker article . . .
“Banks actually keep pretty crummy records,” says Peter Holland, a University of Maryland law school professor who focuses on consumer debt.
The person [filing an affidavit] doesn’t have personal knowledge of the records, even though he says he does, says Charles Debaulm, an attorney for the National Consumer Law Center who has litigated robo-signing involving mortgages and other types of consumer debt. When challenged by a competent consumer defense attorney, “the debt [collection agency] buyer will simply dismiss the suit.”
What has worked in the favor or creditors is the fact that defendants rarely show up in court, enabling creditors to win default judgments in most circumstances. However, when lawyers have put up a defense in such suits, they boast of winning the overwhelming majority of even contested cases.
Getting judges to focus on the lack of proof in debt buyer cases has taken awhile, Holland says. “But often the exact same kinds of problems exist in the original creditor cases.”
Rochester County, N.Y. Judge Philip Straniere found problems extended to Chase’s own collection efforts and dismissed 150 Chase collection cases that relied on dubious affidavits. The documents “appeared to be signed in large numbers by only a few individuals,” the judge wrote in an opinion first cited last year by the Wall Street Journal.
I was served with a lawsuit to collect on a debt. What should I do now? Here is a consumer rights attorney offering basic advice. Indebted consumers should find the right consumer rights attorney should they need him or her. They ARE affordable because they know what they are doing.
Here is another eliminate debt legally related post – Banks and Junk Debt Buyers Cannot Document Their Credit Card Lawsuits – http://www.creditsabre.com/credit-card-debt-relief-laws/banks-and-junk-debt-buyers-cannot-document-their-credit-card-lawsuitsdebt/