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Still no reason for abusive debt collectors to fear regulators
March 3, 2009
By Chuck Jaffe, MarketWatch
BOSTON (MarketWatch) -- Let's see
if I get this right. If a big financial institution gets into trouble, the
government is ready to step in and bail it out and make the little guy pay for
it. But if the little guy gets into trouble, and the big financial institution
comes demanding its money back, not only does the little guy get no relief, but
he gets little to no real government protection when the lender applies
strong-arm tactics to collect its debt. And for all of the talk of meaningful
change in Washington, abusive collection actions won't be stopped any time
soon.
Last week, the Federal Trade Commission issued a report saying
that the debt-collection legal system must be reformed and modernized "to
reflect changes in consumer debt, the debt collection industry and technology."
The idea is to put more bite into the Fair Debt Collection Practices Act, and
the problem is that the moves being discussed are more like a wink and a smile
than a growl at the bad guys.
The FTC took in roughly 105,000
complaints about third-party and creditor debt collection in 2008, according to
numbers released last week. That makes it the subject generating the second most
complaints -- identity theft is No. 1 -- about one in every 11 that the agency
receives.
The Fair Debt Collection Practices Act was enacted in 1977 to
protect the public from abusive, unfair and deceptive practices by debt
collectors, with the FTC made the primary enforcer of its rules and regulations.
The rules have been tweaked over the years, but the premise has always held
steady: Debt collectors are entitled to do their job, but not by badgering,
pestering, brow-beating and intimidating the debtor.
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http://www.marketwatch.com/news/story/weak-regulatory-changes-wont-stop/story.aspx?guid=%7BF8D359CC-E8E1-43C8-B367-09B3288B40C5%7D&dist=msr_1
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