I believe most default judgments occur for one reason: the consumers know they owe the debt and see no reason to prolong the situation. Many consumers will
call us and make payment arrangements after being served. We advise them they have the opportunity to be heard in court but most decline. They simply want to resolve the debt.
Consumers who ask for validation should receive just that: a validation that the agency has verified the balance due has some basis as alleged. Too often consumers categorize this process as requiring "proof" as taxguy does. This is not the function of the validation process. "Proof" is something that will occur in court (or not). No document will be enough "proof" for many consumers. That is why the court system exists.
My concern about a "reasonable" investigation is that it is so subjective. It opens the collector up to an entirely new avenue of prosecution. It is unlikely that a consumer and collector are ever going to agree on what is "reasonable". As it stands now courts have steadfastly maintained that collectors are allowed to rely on information given to them by their clients: ie: a debt for an amount stated against consumer so and so. Beyond that the consumer and the collector have the ability to ask a third party, a judge, to make a determination. By all appearances the FTC and the CFPB would place this burden directly on the collector, with predictable results: more needless litigation over the process and less resolution regarding the debt itself.
One alternative might be for the rule to state a set formula for verification along with the proviso that if the collector follows it they are provided a safe harbor from litigation. However the myriad possibilities for reasonable investigation probably preclude anything so simple. In the end I think it is still a judges purvey to make the final determination.
jeffreyjon
1
I believe most default judgments occur for one reason: the consumers know they owe the debt and see no reason to prolong the situation. Many consumers will call us and make payment arrangements after being served. We advise them they have the opportunity to be heard in court but most decline. They simply want to resolve the debt.
View this comment in the discussion thread
jeffreyjon
2
Consumers who ask for validation should receive just that: a validation that the agency has verified the balance due has some basis as alleged. Too often consumers categorize this process as requiring "proof" as taxguy does. This is not the function of the validation process. "Proof" is something that will occur in court (or not). No document will be enough "proof" for many consumers. That is why the court system exists.
View this comment in the discussion thread
jeffreyjon
3
My concern about a "reasonable" investigation is that it is so subjective. It opens the collector up to an entirely new avenue of prosecution. It is unlikely that a consumer and collector are ever going to agree on what is "reasonable". As it stands now courts have steadfastly maintained that collectors are allowed to rely on information given to them by their clients: ie: a debt for an amount stated against consumer so and so. Beyond that the consumer and the collector have the ability to ask a third party, a judge, to make a determination. By all appearances the FTC and the CFPB would place this burden directly on the collector, with predictable results: more needless litigation over the process and less resolution regarding the debt itself. One alternative might be for the rule to state a set formula for verification along with the proviso that if the collector follows it they are provided a safe harbor from litigation. However the myriad possibilities for reasonable investigation probably preclude anything so simple. In the end I think it is still a judges purvey to make the final determination.
View this comment in the discussion thread