Collection Agencies
In my over five years in collections industry (both representing collection agencies and representing consumers) it is my personal opinion that it is rare to find a “Bad Collection Agency”. My firm receives thousands of calls every week and sure, there are “repeat offenders”, however, most of these agencies are not “Bad” in and of themselves. The “repeat offenders” are usually the largest agencies, with the most employees, with the largest number of accounts. Its no surprise that certain collection agencies are always in the news for violating the law. If one agency has twelve employees and another has thousands, statistics would dictate that the agency with thousands of employees will get more complaints against them than the agency with twelve.
However, there are certainly bad debt collectors; individuals who are so greedy and will go to any extreme to earn their bonus checks. Most, if not all, collection agents are paid bonuses for reaching certain goals. This system certainly contributes to the frequency of violations, but incentivising employees is not an unusual practice. I will, from time to time, publish information on lawsuits that I have filed. Please keep in mind however, that just because I sue XYZ agency over and over doesn’t necessarily mean they are a “repeat offender”. Its likely that the agency is so large that its simply due to statistical measures that they are repeatedly being sued or, to their dismay, they hired a rogue collector.
Jeffrey Hyslip
August 25th, 2008 at 7:38 pm
So if a creditor does hire a “rogue” collector — why should they be punished? Shouldn’t they just have to fire the guy and apologize?
September 2nd, 2008 at 10:44 pm
Dave,
Thanks for your question. First of all, keep in mind that the FDCPA only applies to third party debt collectors, not to creditors. The Creditor is the company you borrowed the money from. The collection agency is the company the Creditor hires to collect the debt after the Creditor’s efforts to collect it have failed.
This Country requires employers to be responsible for whom they hire. If you went into a grocery store and the cashier elbowed you in the face while bagging groceries and broke your nose, you would probably be entitled to (and want to) sue the grocery store. If employers were not responsible for the conduct of their employees, there would be much less incentive for companies to regulate their employees conduct.
If an individual is under the control/supervision of its employer, most of the time the employer is on the hook for the employees actions. There are exceptions, however there is no need to cover them here.
The Fair Debt Collection Practices Act was passed to place additional burdens on the employers of collection agents. Often, “rogue” collectors bounce from agency to agency. An employer should conduct reasonable investigations into the employees it hires. As such, it makes sense that we make the collection agencies responsible for the conduct of its employees.
Arguably, if the agency was monitoring their employees properly, providing adequate training, and screening their employees before they were hired the FDCPA would never be violated. In the “real world” however, this is a much more difficult task than one would assume. Sure, there are some agencies out there that blatantly ignore the FDCPA; I find this to be more of an exception than the rule, however.
Jeffrey