By: Christopher Albin-Lackey. Published by: Human Rights Watch. Published on: January 20, 2016

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Debt buying contributes to a massive amount of litigation in the United States, as companies have realized considerable profits can be made by purchasing debts at low prices and filing suits against alleged debtors. In New York for example, eight of the state’s 20 most litigious plaintiffs were debt buyers in 2014, accounting for nearly half of 142, 506 cases filed that year. The article describes several problems related to the handling of collection cases by state court systems. Among these issues, courts often assume a “rubber stamp” approach in which many judges ask of no evidence to justify a lawsuit before blindly issuing default judgments. Designed to push along heavy caseloads, this method merely allows plaintiffs to circumvent the standard burden of proof while denying debtors a fair defense. Furthermore, interviews with relevant parties and literature reviews reveal that defendants are denied proper justice by judges who encourage them to engage in private discussions with debt buying attorneys. Too often, these judge-less deliberations lead unrepresented debtors to surrender their rights and succumb to legally unjustified demands.

The article goes on to promote a need for greater fairness in such proceedings, pointing out several areas of improvement in debt buyer litigation. In order to increase fairness in the justice system, the Human Rights Watch urges legislators to reduce deceptive litigation practices by requiring courts to enforce the need for credible evidence. Further pleas to Congress call for definitive limits on the outrageous interest rates that current laws allow collectors to demand. These immense burdens often place people at even greater disadvantage, resulting in further struggle to meet basic needs and support one’s family. A critical argument is also made for expanded pro bono representation, provided through access to state and federally funded legal aid programs. Adequate counsel would help debtors better understand the full extent of their rights and more effectively contest deceptive claims. By reducing the occurrence of predatory debt collection strategies, such reforms would shape a court system better geared toward providing fair and equal access to justice.

Categories: Consumer, Consumer/finance, Consumers, Legal Aid Practitioners, National, Policymakers and Funders, Researchers and Academics