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No mercy for consumers

Firms' tactics are one mark of a system that penalizes those who owe

http://www.boston.com/news/special/spotlight_debt/part1/page1.html

Dimanche is one of thousands of Massachusetts residents who have had their cars seized and lives upended by a pair of debt collection companies, Commonwealth Receivables Inc. of Watertown and Norfolk Financial Corp. of West Roxbury. Run by two brothers, one of whom was disbarred this year for his business practices, Norfolk and Commonwealth have become two of the state's most litigious and aggressive collectors, a Globe Spotlight Team investigation of the debt industry has found.

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If those 2 CA's are that bad- I saw MANY violations just in that article, why doesn't the FTC step in?

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Wholy crap. Have any of you read part two that came out today???

A judge told a debtor that was being sued by a CA in session to hand over her jewelry as collateral on the debt or be imprisoned! WTF?!

And judges are regularly threatening debtors with imprisonment if they fail to pay. This is nuts.

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It's free to register to read the rest of the article, but here's the piece about this judge !! :shock:

A 50-year-old mother and nursing student, Albertson stood before Judge Thomas Barrett in Brockton District Court on Feb. 7, called to account for a $438 oil bill that she believed, mistakenly, she had paid. She admits she had been sloppy about the matter, missing court dates twice, in the crush of family and school obligations. And after an initial court judgment against her, she sent a check to satisfy the debt, but stopped payment on it.

That made the plaintiff, Stanley Litchfield of Scudder Fuel, angry - and understandably so. The firm had waited more than a year to be paid. But even he was shocked at what the judge did that day.

''Take your rings off,'' Barrett said, according to the court's audio transcript of the hearing.

''All of my jewelry?'' Albertson replied in dismay. ''I can't give you my wedding ring.''

''Let me see it,'' Barrett said, ordering her to approach the bench and splay her hands before him. He then told her sternly to remove the other rings, including her diamond and amethyst engagement ring, and her earrings.

''Are you serious?'' Albertson asked, near tears.

''We'll hold them until the debt's paid,'' Barrett said. ''Either that or I'll incarcerate you. Do you want me to incarcerate you?''

Albertson handed over her jewelry, keeping only the thin gold band on her left ring finger. A bailiff sealed them in a plastic bag, where they would stay for a month.

I"m sorry, but that woman's jewelry was exempt from siezure !! Totally out of bounds !!

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OK, THIS is scary-- but the Globe is NOT telling all the facts here:

Marc Marcelin, a 53-year-old Haitian immigrant, didn't get to his relatives in time.

On the morning of Dec. 13, two constables arrived at Marcelin's home in Brockton. They handcuffed him and drove him to Quincy District Court, where he sat in the lock-up of one of the state's dingiest courthouses for nearly six hours. About 3 p.m., he was called before Judge Mark S. Coven.

''So, you haven't come up with the money?'' Coven asked.

Marcelin was being sued by Madeline Cordon of Randolph, for failing to do a contracting job. She had paid him $2,000 to put vinyl siding on her house. He did two days' work but then didn't return her calls for six days - facts that Marcelin, in an interview, did not dispute. Cordon sued him, and Marcelin twice failed to show up for court.

Marcelin was no stranger to the court system, having faced charges years earlier for using drugs. But that was not the matter before the court on this day. Indeed, he had no idea how high the stakes were when he left home that morning. Standing before Coven, Marcelin told the judge his sister was supposed to be coming to court with money.

''Is she coming today?'' Coven asked twice, according to an audiotape of the session. Marcelin was not sure.

Coven told him he was being found in contempt of court and ordered, ''that you be held at the Dedham House of Correction to be released upon payment of $2,300,'' including fees and interest.

After a long silence, Coven asked, ''Do you understand that?''

Under the law, a judge can fine a debtor $200 for contempt, or put him in jail for up to 30 days. Coven did not give Marcelin a chance to contact a lawyer, as the Massachusetts court standards recommend. There is no constitutional right to a lawyer in civil cases.

When Marcelin's sister called the court that day to arrange payment to free him, she said, a clerk told her ''not to bother,'' because he also owed money in Brockton District Court. The clerk made the same comment about Marcelin's situation to a Globe reporter that day.

Marcelin was locked up for 28 days.

What the Globe is NOT including here is that Marcellin had the judgment rendered against him the first time. The 2nd court appearance, I'd bet, was for a debtor's exam, which Marcellin didn't show up for. Therefore the arrest warrant was issued for contempt. One of the documents on this case refers to 'the judgment debtor'. They can't lock you up for not paying.. but they CAN lock you up for ignoring the court ordered debtor's exam.

These MA judges and 'clerk magistrates' are out of control !!

MA statute says;

No person shall be arrested on execution in a civil action unless the creditor or, in case the creditor is a corporation, an officer thereof, after execution has issued makes application for a certificate authorizing said arrest and files affidavit with and proves to the satisfaction of a district court that he believes and has good reason to believe that the debtor intends to leave the commonwealth so that supplementary proceedings will not be effective against him.

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Yes, but she missed 2 court dates. The first one was likely when she lost the judgment, or maybe the 2nd, but I suspect the judgment was already final by then and the last court date was for a debtor's exam.

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http://www.boston.com/news/special/spotlight_debt/part2/page1.html

Dignity faces a steamroller

Small-claims proceedings ignore rights, tilt to collectors

The ''people's court'' has become the collectors' court, a Globe Spotlight Team investigation has found. It is a de facto arm of a fast-growing and aggressive industry that has swamped court dockets with lawsuits - cases that often lead to threats of jail for debtors.

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How about the part of the article where OC/CA lawyers were allowed to sit in the court clerk's seat next to the judicial bench and started calling out names to come up and sign payment agreements?

Or how about the constables that threatened imprisonment and handcuffed people when they came to collect on a lien?

Or how "fill-in" lawyers were allowed to answer for no-show plaintiffs with no representation agreement, but consumer no-shows were defaulted against?

The only bright spot was the court justice that went thermal when she heard about how the lower courts were handling things.

The fact is, we, the United States, are rapidly turning away from the Republican form of government --The US is not a Democracy, that is a misnomer -- to a Corpocracy (Government run by corporations). I hope that slide ends soon, or we are all for the high-jump.

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This is MA right?

http://www.boston.com/news/local/massachusetts/articles/2006/08/01/judges_say_they_launched_reforms_for_debtors_issues/

Judges say they launched reforms for debtors' issues

Changes include preventing car collection

By Walter V. Robinson and Michael Rezendes, Globe Staff | August 1, 2006

The two judges who oversee the Massachusetts district court system said last night that they have launched a series of reforms designed to address ``issues" in the courts' treatment of debtors raised in a Globe Spotlight Team series, including retraining for judges and clerks, new efforts to make debtors aware of their rights, and possible legislation aimed at curbing abuses by debt collectors.

In a joint statement, Lynda M. Connolly, the chief justice of the Massachusetts District Courts, and Robert A. Mulligan, the chief justice for administration and management for all of the state trial courts, said the legislative changes they may seek include one to prevent collectors from seizing cars from most debtors.

The Spotlight series has focused on debt collectors prone to using tough tactics after winning court judgments against debtors. In thousands of cases, the collectors engage constables or county deputy sheriffs to seize the debtors' cars, which are effectively held hostage until they pay the debt.

In addition, the two chief justices said that they may propose legislation to ensure that people being sued over bad debts receive more reliable notice. The Globe found that debtors, in many cases, never receive notice that they are being sued for debts, often because the collector provided a long-outdated address to the court. Two years ago, the 70 district and municipal courts did away with a dual notice requirement used by many states -- first class mail and certified mail -- by eliminating certified mail.

Court officials, Connolly and Mulligan said, ``recognize that people who come before the courts in small claims cases are usually people of limited means and are often embarrassed to be in court under such circumstances. They deserve the utmost courtesy and consideration."

They said the trial court ``is committed to evaluating its practices and improving the delivery of justice."

The carefully worded statement did not specifically acknowledge that there are abuses in the system. But the two judges said they have implemented changes, and since April they have moved aggressively to consider administrative and legislative changes. The planned changes were launched, court officials said, after the Spotlight Team first asked Connolly about the abuses in February.

Robert J. Hobbs, the deputy director of the Boston-based National Consumer Law Center, said the Spotlight series has pointed to the need for the state to move quickly to ensure debtors get sufficient and reliable notice they have been sued. And he said debt collectors ought to be required to provide the courts with evidence of the debt they say is owed -- something that, the Globe found, almost never happens in the small-claims sessions of the district courts.

Ensuring adequate notice to debtors was also a concern for state Senator Robert S. Creedon Jr., the Senate chairman of the Legislature's Joint Committee on the Judiciary. ``If the situation is as bad as [the Globe] reported, then that's got to be addressed," Creedon said in an interview.

Creedon also bemoaned the transformation of the small-claims courts into a system swamped by hundreds of thousands of lawsuits filed by corporate debt collectors.

Small claims sessions, he noted, were designed so ``two folks could go before a magistrate and have an issue heard. But now you have these companies that come in with thousands of complaints. Justice is clearly diminished."

Hobbs, a national authority on consumer debt issues , said the requirement that debtors need only be notified by ordinary mail would be unlikely to ``pass muster in federal court because it does not meet the constitutional standard for due process." A federal court decision against the state ``would cast a shadow over all the judgments" the court issued since it eliminated the back-up certified mail, he said.

Hobbs, referring to the callous treatment of debtors by some court officials, said: ``If it becomes more like a courtroom, and less like a processing mill, some of these abuses would go away."

To make sure that debtors are assured a fair outcome, Hobbs said, the state should require that debtors produce evidence of the debt. Credit card lawsuits are contract cases, he said. For that reason, Hobbs said, the debt collection lawyers would have to produce a copy of the contract on at least one charge slip to establish debtor liability.

Under the present system, Hobbs said, ``I could go into any court in Massachusetts and file 100 credit card claims without even owning the debt, and I would be able to collect 80 default judgments and then collect on them." Such abuses, he noted, have occurred in other states.

Creedon said he believes reforms can be accomplished by Connolly, and would not require new legislation, but that he would consider any new legislative proposals she might have.

Globe reporter Beth Healy contributed to this report.

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Ah-men. At least something appears to be getting done. The real shame is that it takes a full blown exposure in the national media to get such results. We should not have to embarass judges and government into doing the right thing.

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I think it is so sad that people dont know what they can and cant do under the law, and then when they try to fight back, they get slapped in the face by none other than the law which is supposed to protect them. I can see how they would get intimidated, even after everything I have learned, if someone came to my door at night with the police I would be intimidated too. I have learned to keep copies of EVERYTHING. From bills, to checks to statements to receipts.

Someone will always try to find a loophole and catch you not paying attention and then burn you.

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Enforcers' might goes unchecked

http://www.boston.com/news/special/spotlight_debt/part3/page1.html

When debtors cannot raise the cash to pay the debt and the seizure fees, their cars are sold at auction. Here again the constables are part of the game: Proceeds of the auction are split among the constable, the tow lot, and the creditor. Almost always ignored, the Globe found, is a state law requiring that the first $700 of the sale proceeds be returned to debtors.

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Small claims used to be a decent venue- but that court (along with many others) is becoming a rubber stamp for business owners

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National Crisis, Official Silence

http://www.boston.com/news/special/spotlight_debt/part4/page1.html

Yet, in spite of all this, there is an eerie silence among regulators, policy makers, and legislators. Those who could intervene to right the balance between collectors and consumers are either unaware of the debt collection free-for-all, and the tens of millions of consumers caught up in it. Or they are simply unwilling to act.

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Simply amazing, look what Mike Bevel, moderator of collectionindustry.com had to say about the Globe's article.

http://www.collectionindustry.com/item/20015

Boston Globe Finishes Attack Series on Debt Collectors

August 3, 2006

by Mike Bevel

CollectionIndustry.com

On some level, you want to love the Boston Globe — the scrappy little paper that thinks it can. But…

The Globe is finishing up its four part series on the evils of the debt collection industry. In the last and final episode, the Globe wades deep into cliché territory and holds our hands as it tells us that sometimes debt collectors meet in Las Vegas. “Las Vegas” in this scenario is a metaphor for “evil den of inequity” rather than “Home of the Celine Dion Mega Concert” and “Base Camp for Cirque de Soleil.”

The Globe was present for 2005’s debt buyers’ conference, where they were shocked and appalled that companies out there might make money buying debt. Were it within their power, no doubt, the Globe would send each and every reader a set of pearls with which to commence pearl clutching.

“[Debtors] generally owe the money,” the Globe generously proffers. But they’re not happy that anyone out there might want to be paid that money.

The Globe worried that there’s some sort of karmic unbalance, with debt buyers and debt collectors holding some unfair advantage over debtors. Never mind, apparently, that the debtors may have had a hand in their own situation; that’s merely happenstance. Instead, the Globe winsomely worries about the “eerie silence among regulators, policy makers, and legislators.”

It’s curious, though not surprising, the Globe’s stance on this issue. It’s easier, of course, to see no fault on the part of the original debtor – the individual who entered into a financial agreement with the original creditor; a creditor, it should be pointed out, since the Globe won’t, who is now out of pocket the cash owed. Instead, the Globe wants more regulations on debt buyers and collectors rather than any sort of holistic approach to debt education among debtors.

Education, it seems, doesn’t sell as many papers.

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What utter horse-sh*t.

Mr. Bevel needs to be reminded that it is the illegal actions, misrepresentations, and fraud in their industry which drives the Globe's article.

If he doesn't like the LAW that says there is a limit on how long something can be collected upon, he should lobby for its change. But if he or any other CA failes to obey the law or attempts to twist its spirit to their advantage, then they deserve all the bad publicity they get...and more laws to clamp down on the behavior.

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With tactics like sewer service, harrassment, and illegal listing on your credit, I feel like they deserve all the bad credit they get.

If they didn't break the law, we couldn't beat them like we do...

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I really hope there is some change in the way the courts handle these cases, but having lived in MA all my life, I am doubtful.

Maybe these companies in the spotlight will go away....for now - but then there will be others who open up and have a little more finesse in breaking the law and getting away with it.

IMHO, the court system in MA is totally corrupt. On top of that you have arrogant judges/magistrates who will rule any way they want - regardless of the law.

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I am ashamed.

I lived in MA for the many years growing up. After graduating college, I left and lived in GA for nine years. I was always very proud of where I came from. I looked at what I thought to be terrible injustices in the 'good old boy' legal systems of the deep south. In my youthful naiveté I never realized how awful the courts in MA actually are. I have recently moved back to MA for more school (and debt :() and I am shocked. Its outrageous!

The big irony is that Boston is one of the most liberal places on earth, although I am not making any political opinion here.

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