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"Ethel, you did this!" Joe barks into the phone, his voice booming through the divider between our desks. Joe is trying to collect a credit-card bill, but Ethel is unaware of the card's existence -- or claims to be. "Stop making excuses!" Joe tells her.
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It's my first week on the job as a debt collector, and already I'm learning a lot. Or rather, unlearning a lot. Everything I know about consumer finance is wrong here.
In this upside-down world, unpaid bills are a boon, not a curse. The bigger, the better. If we collect, the agency gets a bounty of 10% to 50% from the creditor, and it gives us a cut. Top collectors are handed bonuses of $10,000 or more at a monthly assembly, while envious co-workers clap and cheer.
In this world, identity theft isn't an epidemic. It's an excuse used by weaseling debtors -- like job loss, illness or even the death of a spouse. In the notes we make after each call, these excuses are summed up with the code HLS -- hard-luck story.
Joe tells Ethel that he's looking at her credit report and it doesn't support her innocence. "This card was paid every month for two years," he says. "Identity thieves don't do that!" Maybe he's right and she's trying to skip a legitimate bill. Or maybe he's making it up.
The collection industry gets the most complaints of any industry regulated by the U.S. Federal Trade Commission -- more than 300,000 in the past five years. The trade association, ACA International, blames the griping on consumers' increasing debt burden.
But inside the large, well-established agency where I work, that's not the whole story. Motivated strictly by cash, collectors manipulate, shame and threaten people into paying, without caring whether the bill is legitimate.
"Get the money!" our team leader exhorts us in a brief morning huddle. Then we hit the phones, making 150 to 200 calls a day. Most are answered by machines or by people who say we've got a wrong number.
Debtors are cagey about picking up, so we're taught to mask the purpose of the call as long as possible. We ask for them casually by first name, like an acquaintance. Outright deception is forbidden, but sometimes my co-workers pose as paralegals or even as "fraud investigators," to imply that criminal charges are looming.
Once a debtor is on the line, we demand that they pay the overdue balance immediately. But the balance is like the sticker price on a car -- a starting point for negotiation. On some accounts, I may offer a settlement that wipes out half the bill. This helps to placate debtors. They're usually sputtering mad because their actual purchases are a pittance compared with the interest, late fees and over-limit fees they now owe.
If a debtor opts to settle, I am trained to take their application. In a bored voice I ask for their cell-phone number, their spouse's work phone and so on, as if I'm filling out a form. There's no application; we get the phone numbers to hound them if their payment falls through.
To help debtors raise money, we are trained to give them financial advice that would make their accountant blanch, if they had one. We suggest that they take money out of their IRA, drain their home equity with a second mortgage, load up a different credit card or even skip a mortgage payment.
If a debtor still won't pay, we play a version of good cop/bad cop. Two collectors will team up on one call, with one posing as a hard-hearted manager. The other listens patiently and pretends to be sympathetic. The idea is to make the debtor want to please the sympathetic collector, who closes the deal.
Even people like Ethel, who claim to be fraud victims, can be squeezed for cash. We say it was probably their child or someone else in their household who abused the card, and if they don't call the police, we will.
But Joe loses his battle of wills with Ethel for today when she simply hangs up. Calling her back immediately would violate rules against harassment. I go around the divider to commiserate, and to see whether Ethel's credit report really implicated her. But Joe has already deleted it from his screen and pulled up another account, preparing to make his next call.
Our group manager has also been listening. "You blew it," he tells Joe loudly, so the rest of the group can hear. "You should've got her to pay."
Author Fred Williams's book, Inside Debt Collection, is available at www.lulu.com.
POSTED BY: Charles (November 13, 2008 06:56 PM)
Having just read "The confessions of a Debt Collector" prompted me to write about a recent experience I had with one out of San Diego.
I had received numerous calls about a debt I had nothing to do with, and so informed the callers who could barely speak English. They were informed as such and ordered to stay off my phone. They persisted, even telling me I could not stop them. Even the 800 numbers were "No longer in service". I filed a report on "Consumer Rip-off Reports" and, while doing so, I happened upon an ad from a law firm in Los Angles who promised to stop the calls at no expense to me. Consequently, I went to Federal Court in San Diego where I won the case (more damages are pending) and the law firm paid for my trip.
The collectors (two lawyers) even had bogus phone numbers, social security numbers, and addresses on me that I have never had. They even had me owing a bill that I never had and was listed with those bogus numbers.
I did find the Federal Government, as is generally the case, protects the business, not the victim. But it was still a great source of satisfaction to be able to speak directly to the judge and watch the collectors "eat crow". Plus, I had a pleasant flight to California from Atlanta at no expense to me.
I have even written "Addressee Deceased" on repeated mailings from some collectors. I have learned how (and do) have some fun with them when they get overly persistent and especially when they fabricate a debt against me.
POSTED BY: ellen (November 20, 2008 07:57 PM)
...My ex forged my name to...a timeshare he got in the divorce. When he didn't pay they came after me, and I knew nothing about it! They tried to tell me that my ex said I paid the bills all along, which was a lie. They said my ex talked about how he had to talk to his wife, and when I pointed out we are divorced, they changed it to "ex-wife". They threatened to take legal action against him if I persisted denying I signed, so I trumped them and called the police myself--after I pointed out to them that THEY are also culpable, because their agent clearly knew my signature was forged (he noted that he had seen my driver's license, and he hadn't because I wasn't there)...They finally gave up on me and went after my ex, who finally paid...
POSTED BY: Suzanne (December 10, 2008 10:37 AM)
This is no joke. After my mother passed away at the holidays I basically did nothing...not even pay bills for 2 weeks while traveling for that. The company we make our house payment to began calling to remind me. Then when I answered the phone they yelled, told me I was a bad mother and to borrow the money or they would take our home. Explaining my situation did nothing. They even sent someone, after only being 7 days late with our payment, to our home! They left no business card but a ripped piece of paper with a name and number on it. I don't even know how they got into our gated community! I finally got to my bills, paid this and they demanded I cancel the check I mailed and make a payment over the phone. My husband fell for this. I work for lawyers and did what they suggested and have not had a problem since. These people can be frightening!
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