Suing a Debt Collector for Collection Abuse and Winning

With debt collection abuse on the rise, debt collectors have been increasingly whiny lately.

For the past year, I have seen weekly reports that provide a breakdown of how many consumers have filed suit against debt collectors for violations of the Fair Debt Collection Practices Act (FDCPA). I have also seen an increase of people working in the collection industry commenting online as relates to these reports. The comments typically convey a “woe is me” attitude about the increase in the amount of consumers who are taking them to task on the abuse.

Should anyone feel sympathy for the industry with the most complaints filed against it nationally for several years running?

Let’s take a look into some recent articles in major publications covering the volume of debt collection lawsuits being filed vs. consumers filing suits after experiencing debt collection abuse:

The Star Tribune ran a great article a few weeks ago. It is a fantastic source for detail into the growth of attorneys specializing in representing consumers who have been abused by collectors. From attorney Pete Berry in that article:

“Why did you call my client a low-life piece of shit?” Barry asked the collector, according to the transcript.

“In about 10 seconds you’re going to have that answer, Mr. Barry,” the man replied.

“I’d like the answer now, please,” Barry said.

“Well, you have to get it when I give it. …” the collector said.

“I’m asking you, and I’m going to ask you again, the question is, why did you call my client a low-life piece of shit?” Barry said.

“Because in my opinion, a person who doesn’t pay his bills … is a person who in my opinion is a low-life piece of shit,” the man replied.

Also from the Star Tribune article:

“Federal lawsuits by debtors against collectors have soared sevenfold over the past decade, in a mirror image of the huge jump in collections judgments that Barry and others accuse debt collectors of churning out mill-style without regard to accuracy. And while collectors usually win judgments when they go to court, debtors are finding success when they fight back.”

So how many collection law suits are filed each year?

“9,290 cases were filed nationwide in federal courts against collection firms in 2009, according to WebRecon.”

The article goes on to say:

“High-volume consumer law firms are churning out lawsuits as efficiently as the collectors they battle. Many of these suits are cookie-cutter complaints that are skimpy on details — just like many collection actions clogging the nation’s court systems.”

Then we have the excellent NY Times piece from a couple weeks back discussing how the courts are clogged with boiler plate lawsuits filed by debt collection law firms. The article highlights the practice of just one firm’s volume:

“Cohen & Slamowitz, a Woodbury, N.Y., firm that has specialized in debt collection for nearly two decades. The firm has been filing roughly 80,000 lawsuits a year. With just 14 lawyers on staff, that works out to more than 5,700 cases per lawyer.”

“The firm filed 59,708 cases in 2005, 83,665 in 2006, 87,877 in 2007 and 80,873 in 2008, records… show.”

So, umm…. One attorney in one firm in NY files in one year more than half as many suits filed on behalf of abused consumers nationwide? Debt collectors doth protest too much!

Debt Collectors Callously Collecting

An earlier article also from the Star Tribune points to how little compassion there exists from debt collectors:

“One afternoon last spring, Deborah Poplawski, 38, of Minneapolis was digging in her purse for coins to feed a downtown parking meter when she saw the flashing lights of a Minneapolis police squad car behind her. Poplawski, a restaurant cook, assumed she had parked illegally. Instead, she was headed to jail over a $250 credit card debt.”

“She spent nearly 25 hours at the Hennepin County jail.”

These articles are just a small snapshot of the problems with debt collectors running rough shod through the courts and through the lives of financially disadvantaged consumers. Collectors generally could give a rip about consumers. They want their money! Whether a person can afford to pay, whether they have the right to collect, whether the debt is time barred from using the courts, whether they have documentation to back up their claim, whether they are even trying to collect from the right person!

Today I found an article published on a collection industry website which, in my opinion, typifies the attitude of the collection industry as relates to the gall of consumers to bring claims against collectors.

From the article at InsideARM: “let’s move on to another class of debt collection-related suits that is growing so rapidly, it has the potential to “clog” the court system before too long: FDCPA claims against ARM companies.”

How much of a clog you may ask? Here are the numbers that so offend the author:

“According to… WebRecon update, through July 31 there have been 6,267 cases filed by consumers claiming violations of the FDCPA, well on pace to exceed 10,000 for the year.”

So, umm… Here again, just two lawyers at the Slamowitz firm in NY file more debt collection cases in one year than all of the combined suits filed by consumers against collectors nationwide.

Please excuse me for not having compassion for collectors whining about an increase in consumers protecting their rights by fighting back with an extremely small amount of civil claims for abuse.

May I suggest Gouda with that Merlot?

If you are, or feel as though you have been, a victim of collection abuse, go to NACA and search for a consumer advocate attorney in your area who specializes in FDCPA violations. If you have an attorney, but he/she is not experienced with debt collection violations, get them in touch with the attorney referenced above, Pete Berry: lawpoint.com

If you would like to learn about your options for negotiating a settlement with an account in collections, post details about your situation in the comments below for feedback and additional resources.

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About Michael Bovee

Michael started CRN in 2004 with a mission to provide detailed debt and credit help and advice that encourages and allows people struggling with debt to solve their debt problems just like a pro - but without the high fees.

Comments

  1. I have just received papers from the court that a summary judgment has been ruled in the plaintiff’s favor. (Cohen and Slamowitz) $6800 plus whatever. I am unemployed, we have a mortgage but are underwater by $50K at least and all I have in my name is the title on a car that my in-laws gave us worth $5K?? Can they take the car? Would it be wise to add/tr4ansfer title to my spouse?

    • Michael Bovee says:

      Julie – Your vehicle may be exempt from judgment collection enforcement. What state are you in?
      Also, I would really like to know more about your situation and what led to the judgment with the Cohen Slamowitz firm. As you can see from the post above, the firm has used some questionable practices for collection in the past.
      Would you mind posting a follow up comment to answer the state question and include who sued you, a credit or debt buyer, whether you participated in the case with a defense etc?

  2. Thanks for the response Michael. The details…this is occurring in NY and plaintiff is Citibank. One year ago, despite efforts to work with Citi on some sort of settlement, they threw me into collections several days early and as a result C&S (Cohen and Slamowitz) contacted me. (and my inlaws too! quite embarassing) In January I was served and I contacted the FDCPA filing a complaint. Summons was found in the snow on the ground at the end of my driveway (without an envelope) and they lied on the Affidavit of Service saying that it had been handed to a woman that did not remotely match my description. etc., etc.

    Having searched C&S online I realized that this is an unethical firm and when I responded to the summons I requested verification of the debt and countered that I was not served properly. (I count at least 5 FDCPA infractions.) I have no legal background but was not in the position to pay a lawyer to I represented myself.

    In October I received a Motion for Summary Judgment which I responded to and filed in a timely matter with a cross motion that the judge consider that not only did they fail to ‘properly’ verify the debt (they forwarded photocopies of statements), they did not service me properly. At the time that I filed the response the court clerk told me that normally there is a filing fee for the cross motion but because of the way I had presented it she didn’t think a fee was necessary.

    Last Wed I received two letters. From the judge….she found for the plaintiff and would not entertain the cross motion in part because I had not paid appropriate filing fee. And from C&S …requesting an adjournment until Dec in order to prepare for the cross motion.

    Of course I have no idea what my options are. I am unemployed so they can’t garnish wages, my husbands wages go into a separate bank account and we keep minimal cash in my account. The house is worth approx. $50K less than the mortgage and the only thing in my name is a 2003 Camry.

    Should I be appealing this? Transferring title on the car? Obviously C&S are questionable in their tactics (at best)? And lastly, how quickly do they move on judgements? Any feedback would be greatly appreciated. Thanks

    • Michael Bovee says:

      Julie – If there are FDCPA violations worth pursuing I would suggest you contact an attorney with experience in this type of thing right away. Most FDCPA attorneys take violation cases without charging you a retainer. They take cases and pursue them to a conclusion where ultimately their fees are paid by the other side. If you click the NACA link in the above article and then click on find attorney at the top you will see a menu. Click debt collection for the sub menu then check off FDCPA. On that same screen you will enter your state in the upper left and submit. There is a fair sized list of FDCPA experienced attorneys listed in New York. Call and speak with one near you about your issues.

      From what you shared, you are fairly collection proof, at least right now. How fast collection efforts on the judgment will begin can vary. Other than your checking account you mentioned you keep little money in, it sounds like you are as prepared as you can be.

      As to transferring your car title, I would encourage you to bring that up with an attorney on the FDCPA angles you will talk to. He or she would be able to speak to personal property exemptions for judgment enforcement in New York.

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