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Millions In The US Are Hounded for Debt They Don’t Owe. Options
Posted: Wednesday, October 28, 2020 4:58:08 PM

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Joined: 10/2/2015
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Location: Cambridge, Minnesota, United States

The US has very few protections for consumers when it comes to Collection Agencies or Debt Collectors. This has created an entire industry of businesses that routinely engage in criminal activity under the guise of "Debt Collection".

In 2012 a call center in India was busted for making 8 million calls in eight months to collect made-up bills. The Federal Trade Commission has since broken up at least 13 similar scams. In most cases, regulators weren’t able to identify the original perpetrators because the data files had been sold and repackaged so many times. Victims have essentially no recourse to do anything but take the abuse.

In the case of the person detailed in the article, a debt collector threatened to rape the man's wife if he did not pay the made-up debt.

Phantom debt, he learned, is blended with real debt in ways that are almost impossible to untangle.

The agencies recoup what they can and sell the rest down-market, so that iffier and iffier debt is bought by shadier and shadier individuals. Deception is common. Scammers often sell the same portfolios of debt, called “paper,” to several collection agencies at once, so a legitimate IOU gains illegitimate clones. Some inflate balances, a practice known as “overbiffing.” Others create “redo” lists—people who’ve settled their debt, but will be harassed again anyway. These rosters are actually more valuable, because the targets have proved willing to part with money over the phone. And then there are those who invent debts out of whole cloth. He found people(buying these lists) with convictions for counterfeiting, stock fraud, drug dealing, and child molestation.

Portfolios are combined and doctored until they contain thousands of entries. One collector told Therrien that he’d paid cash at a diner for a thumb drive with a database containing Therrien’s name. Some collectors told him they thought the files were partially legitimate; others knew their paper was completely falsified. Yet they continued to trade it, referring to the people they pursued as deadbeats and losers.

For a time, Therrien focused on Buffalo,one of the poorest cities in the U.S. and a hub for the collections industry—home to agencies that work the oldest, cheapest paper. Debt collector is a more common job there than bartender or construction worker, according to the Bureau of Labor Statistics.

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