The number of calls I've been getting from people who are receiving weirdo contacts from scavenger debt collectors has skyrocketed. In many cases, the debt doesn't belong to those who contact me. In other cases, the debt may be 10, 20 or 30 years old and legally unenforceable.
The Wall Street Journal now reports there's a big problem with law firms who work in conjunction with scavengers trying to collect on old debts. As you probably know, there is a statute of limitations that governs how long someone can seek a judgment in court for an old debt. The statute varies by state.
According to The Wall Street Journal, some scavengers will make a feigning attempt to contact you about a debt you allegedly owe. Then they turn around and, working with dishonest law firms, will sue you against a debt they know is outside statute. Judges are reportedly furious that these cases are clogging the legal system.
The real danger, however, is when people don't show up to defend themselves in court. A default judgment is then entered, and that judgment is fully enforceable. It allows the scavenger collector to legally collect on a debt that may not be yours or may be far too old. Worse still, the amounts being sought by the scavengers are often not even close to accurate, according to The Wall Street Journal.
The other untold story here is that the banks selling these old debts in the first place are fully aware that they're handing them off to possibly criminal intent on the part of the scavenger collectors and the dishonest law firms.
Know that if you are served with papers, you must go to court to defend yourself. If you show up, the scavengers have no proof of the debt, so the claim is dismissed virtually 100% of the time -- simply by you showing up to defend yourself.
After I spoke about this topic last year, I received a note from a judge who suggested that people who go down this road take it one step further -- sue the scavenger collector for violation of the Fair Debt Collection Practices Act! You should be able to get attorney's fees, plus a possible injunction to prevent something like this from happening again. According to the judge, any consumer attorney will gladly take the case because the venue is in the debtor's hometown.