Bohemia, NY (PRWEB) February 03, 2013
On February 3, debt collection agency Rapid Recovery Solutions responds to a recent Federal Trade Commission report which finds that inadequate documentation is rife among commercial debt collection agencies.
A recent article in Bloomberg Business Week suggests that debt buyers are frequently provided incomplete or inaccurate information by lenders, with the Federal Trade Commission asserting “debt buyers seek to collect on more than a million debts each year that consumers assert they do not owe or that they owe in a different amount.”
“As the credit bubble inflated, so did the business of collecting on bad debts,” says the article. “When a loan sours, lenders will often sell it to a third party that buys debts. On average, a buyer will pay 4¢ on the dollar for the IOUs and hope it can get people to pay up through letters, calls, threats of legal action, and sometimes questionable legal practices.”
A major problem plaguing current debt collection practices is the lack of reliable information about debtors, says the article. Debt collectors target debtors using possibly-outdated account details provided by the original lender. A recent report from the Federal Trade Commission found that “lenders often provide no assurance that the information they’re selling is accurate. They also tend not to give enough info even for buyers to verify the debts, meaning consumers have plenty of room to contest them.”
According to the article, 88 percent of the FTC’s sampled cased were not backed up with any documentation. The study found that in the overwhelming majority of cases, lenders “provide no assurance that the information they’re selling is accurate.” THey also have a tendency to provide so little information that debt buyers have trouble verifying the debts, meaning consumers have ample opportunity to contest them, says the article. Much of the debt is not organized by type, either, so debts such as medical expenses and credit card debt are indistinguishable.
John Monderine, CEO Rapid Recovery solutions, responds to the FTC’s findings.
“The lack of adequate data provided by lenders to buyers is a problem for people on both sides of the debt,” says Monderine, who finds that the situation provides abusive collectors with a kind of autonomous buffer zone within which to operate. He continues, “As the debt collection industry is increasingly controlled by governmental regulations designed to protect the consumer, this lack of transparency should hopefully fade away.”
Founded in 2006, Rapid Recovery Solution, Inc. is headquartered at the highest point of beautiful Long Island. Rapid Recovery Collection Agency is committed to recovering your funds. We believe that every debtor has the ability to pay if motivated correctly. We DO NOT alienate the debtors; we attempt to align with them and offer a number of ways to resolve not only your debt but also all their debts.