Debtor Beware: Debt Collectors Find Their Silver Bullet
Clifford Cain Jr. discovered that a debt collection company had garnished his bank account and taken around $4500 to cover an old debt they said he owed. Cain said that he did not even know that he had been sued until he found out that the money was gone from his account.
Midland Funding is part of Encore Capital Group, a gigantic debt collection agency. They did not just go after Cain, but many other residents of Baltimore with the same tactic. They sued the people in court for legitimate debts, debts that were no longer legally collectible, and debts hat they did not owe. The collection agency did not make exceptions: if you were on their list, you got sued. Midland Funding knows …show more content…
This was true even when all logic seemed to point the other way. For example, arbitration clauses are part of an original agreement between a lender and a buyer – not between the buyer and the debt collector. Many times the debt collector cannot even produce a copy of the agreement. Courts are still allowing them to go forward with the enforcement of arbitration.
According to the Times, "Consumer advocates argue it is not fair for debt collectors to enforce an arbitration agreement a consumer signed with a different company. Debt collectors counter that they are buying loan contracts, and the terms come with them."
“It’s beyond hypocritical that the companies can use arbitration to avoid being held accountable in court, all the while using the courts to collect from consumers,” noted Peter Holland, a lawyer who ran the Consumer Protection Clinic at the University of Maryland’s law school.
One civil court judge in New York said that many cases that crossed his desk are “garbage," but defendants do not show up to defend themselves, and when defendants are absent, judges find in favor of the debt
Clifford Cain Jr. discovered that a debt collection company had garnished his bank account and taken around $4500 to cover an old debt they said he owed. Cain said that he did not even know that he had been sued until he found out that the money was gone from his account.
Midland Funding is part of Encore Capital Group, a gigantic debt collection agency. They did not just go after Cain, but many other residents of Baltimore with the same tactic. They sued the people in court for legitimate debts, debts that were no longer legally collectible, and debts hat they did not owe. The collection agency did not make exceptions: if you were on their list, you got sued. Midland Funding knows …show more content…
This was true even when all logic seemed to point the other way. For example, arbitration clauses are part of an original agreement between a lender and a buyer – not between the buyer and the debt collector. Many times the debt collector cannot even produce a copy of the agreement. Courts are still allowing them to go forward with the enforcement of arbitration.
According to the Times, "Consumer advocates argue it is not fair for debt collectors to enforce an arbitration agreement a consumer signed with a different company. Debt collectors counter that they are buying loan contracts, and the terms come with them."
“It’s beyond hypocritical that the companies can use arbitration to avoid being held accountable in court, all the while using the courts to collect from consumers,” noted Peter Holland, a lawyer who ran the Consumer Protection Clinic at the University of Maryland’s law school.
One civil court judge in New York said that many cases that crossed his desk are “garbage," but defendants do not show up to defend themselves, and when defendants are absent, judges find in favor of the debt