The Future of Debt Collection

This is one of those blog subjects where we may be a bit ahead of the curve. I've gotten wind of something I think could be a big story, but it's still very embryonic. I can't seem to find any articles about it online, but if I'm right, we could end up seeing this in the dinosaur media in six months or a year.

What I'm talking about is a new tactic some debt collectors are looking into. I'm hearing that they are interested in using social networking sites like Facebook and MySpace to track down and identify debtors. This is a good reason not to include too much personal or contact information in any online profiles you create.

Normally I'm all for people responsibly repaying their debts. But when it comes to 3rd party collectors, I have no sympathy. Too many people come to me for advice after horrible treatment at the hands of collectors; I've been there as collectors have cursed at retirees and threatened to have debtors arrested. A manager recently called me for advice when a debt collector was harassing one of her employees at work. I've seen collectors sell fraudulent debts to each other endlessly, forcing the debtor to dispute them again and again. All this is to say that yes, it matters if debt collectors can find you online, and no, you shouldn't make it easy on them.

Someone asked me why they should care about this; all collectors can do on MySpace is send you an email, which you can just delete, right? I don't think so. The point isn't that they'll waste their time with harassing emails. It's the information they'll have access to that can put you at a serious disadvantage.

Collectors tend to flail about. Depending on what your name is, there may be hundreds of people with the same or similar names as yours (not that the names have to match for some collectors to begin their harassment). They'll call anyone with your last name, lie and say they're an old friend of yours, and try to get your current address. I've seen this first hand, many times. A friend asked me what to do when a debt collector called him trying to track down his younger brother. Any scrap of information a collector can get on you will help them connect the dots and unleash the hounds in the right direction.

Say you're John Smith, and a collector is after you for some disputed college-related debt from 15 years ago. You might be completely impossible to find. But if the collector were able to find you on MySpace, s/he would see what university you graduated from, and then know whether s/he had the right John Smith. Not only that, you might have your current job posted on your MySpace profile, along with your hometown and salary range. Suddenly, a debt collector goes from having an untraceable "John Smith" debt to having confirmation of your identity, your location, salary, job, etc.

Don't think for a minute a collector wouldn't use any tool at his/her disposal to collect on the debt s/he bought for 3 cents on the dollar. Put too many details in your MySpace page or LinkedIn profile, and you could be handing him/her everything s/he needs to make your life miserable.

(Okay, one more thing here, because I always get ignorant trolls commenting "If you borrowed the money, you should PAY IT BACK!" Junk debt buyers will aggressively go after ancient, uncollectable debts, illegally re-aging them, inflating them, and violating the FDCPA at will. Sometimes, if a debtor responds and repays one of these zombie debts, the junk debt buyer figures "we've got a payer on our hands," and they start assigning all sorts of illegitimate debts to that person, hoping s/he will keep paying them off to make them go away. The point is, DON'T negotiate with junk debt buyers, DON'T "PAY IT BACK!", even if it really was your debt 7+ years ago. Give these people the impression that you can be bullied or harassed into paying ancient debts that you aren't obligated to repay, and it'll never stop.)

Comments

[Credit Wizard]

Although I believe that we all should pay our debts, I also believe that bad things happen to good people. I refuse to judge anyone in an unpaid debt category, because I also once was in a humiliating situation of having collector's banging on my door. Heck, If I had the money I would pay it.It takes time to get out of the bad debt vacuum, but it is possible. Thanks for the info, I will pass it on.
Credit Wizard
http://www.beacon850.com/