As with any industry, the debt collection business has a wide range of participants. Some of them are upstanding members of the community who care about their reputations, and some of them are so focused on the bottom line that they don’t think twice about cutting corners.
When you are looking to hire a debt collection company, they have the potential to fall anywhere on this range, and that can make all the difference when you are attempting to work out a debt collection agreement.
Of course, the debt collection company that you hire will be seen as an extension of your business. That means that how they conduct their business could affect your reputation. If they treat your debtors with respect and dignity, then you might be seen in a positive light. However, if they choose to take shortcuts in the collection process, that bad taste will remain in your debtor’s mouths and their negative feelings toward you could impact your business years down the road.
One of the newer ways that less-reputable collections agencies have been attempting to force debtors into paying is called robo-suing. This is a clever tactic that is a derivative of the robo-signing practice that banks were using a few years ago to remove people from their homes without correctly following the legal process.
That same process is now being used by some collections agencies to file huge numbers of lawsuits against debtors. These companies are filing very similar documents and giving almost identical testimony in all of the cases. When it comes to specific evidence, little is ever presented. Some of the lawsuits have even contained completely false evidence.
An article by Jessica Silver-Greenberg of the New York Times quoted a civil court judge from Brooklyn who claimed that approximately 90 percent of these credit card debt cases are flawed. These companies are flooding our legal system with cases that they cannot possibly prove.
That article also told the story of a JPMorgan Chase executive that was fired after reporting finding out that the company had incorrect balances on over 23,000 delinquent accounts.
Protecting Your Reputation
The recent development of robo-suing is just the most recent in a long line of schemes that have been developed by collection companies that don’t have any regard for their reputation. There are a number of different unethical practices that collections agencies can use to collect debts. Even if these companies were not using these methods to collect your debts, just being associated with them could damage your reputation.
This reinforces exactly why it is so important to make sure you are hiring an experienced and ethical debt collection firm. You should make sure that any company you associate your business with is always going to represent you in an appropriate manner.
Take the time to really scrutinize the collection agency you are considering hiring, and remember that there is more at stake than simply getting a better rate. You want to be represented by a company that will have all of the necessary documentation as well as experience working with an attorney for debt collection, should the collection process end up in a courtroom.