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Chapter 3: The Credit Card Debt Industry

Credit Card Debt Collection Attorneys

“No attorney has reviewed this claim.”  That is the language that is usually included in the first communication you receive for a debt collection law firm.  It is there because attorneys are officers of the court.  An attempt to collect a debt coming from them could be construed as a threat of legal action.  The Fair Debt Collection Practices Act specifically prohibits debt collectors from making threats including threats of legal action.  When attorneys act as debt collectors contacting consumer account holders, they are considered debt collectors first and attorneys second.  Hence they are subject to Fair Debt Collection Practices Act regulations.

What this language also tells you is that you are one of many to be receiving the same communication.  If the firm is a national firm, you are one of thousands.  If the firm is a local firm you are one of dozens at least.  While they are using their legal letterhead to scare you into submission, these initial communications are simply mini-Mirandas that require you to deny, dispute and request validation; the more detail you ask for the better. (See my Debt Validation [DV] letter in Chapter 6).

There are national, regional and local collection law firms.  Many of these firms are networked together.  For example, let’s say Mann Bracken (formerly Wolpoff and Abramson) pursues an arbitration claim against you in the National Arbitration Forum.  You do not resist, so they win the award.  What they do next is turn that award over to their local network attorney who pursues judgments in your court district.  These national attorney networks are a service to the credit card banks and junk debt buyers who by using a national firm that has one, do not have to seek out an attorney in your court district.

The good news is that collection attorneys also play the numbers game.  They are used to filing in court and getting default judgments where the consumer account holder does not answer the summons to the court action.  They get a percentage for processing the paper work and filing the judgment.  Should they encounter resistance in court, they’ll have to spend more time and make less money.  It means they will have to go back up the chain through the national network to the bank or junk debt buyer for original documents to support their case in court.  Whether they will actually get those documents is in question.

Sometimes collection attorneys serve consumer account holders with court summonses without actually filing the complaint in court, which means there really is no lawsuit.  They do this to see if you will respond with an answer to the complaint.  If you reply, they do nothing.  If you do not, they file and get a default judgment against you. Other times a collection attorney will serve you, then you decide to settle, and they say they are willing stop the suit and settle for less than the full amount.  When what they actually do is continue with the suit and get a default judgment against you because you took their word and did not respond. If you had responded and protested they had insufficient documentation, they might have gone away.

Remember, debt collection attorneys play the numbers game spending their time with the most profitable accounts.  It is your job to convince them that you will cost them too much time. 
Most credit card agreements have a clause that states you agree to pay the plaintiff’s reasonable attorneys fees.  Sometimes that is an excuse to pad the balance you owe.  Usually what happens is the collection attorney does not want to take a chance on your ability to pay. The only way the OC or the junk debt buyer is not going to pay them is if they collect money from you.  So they simply will not invest time in your case.

From my personal experience and from what I have read online of others’ experiences, my impression is collection attorneys are at the bottom of the legal profession.  Many would prefer to be out of collections.  Their attention to detail, legal documentation, and practice of proper civil procedure is lacking.

Most debt collection attorneys play the numbers game, efficiently spending their time concentrating on collectible accounts and alleged debtors who are likely to default on a court case or who appear to have worthwhile assets.

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