As the economy continues to struggle, more people are facing the prospect of defaulting on debt. It may be a mortgage, a credit card, a car loan, or medical bills, but in general, people are increasingly forced to choose between paying creditors and paying for life essentials. Since 2008, the FTC has seen the number of complaints filed about debt collectors skyrocket. In two years, the number of yearly filings jumped by almost 36,000.
The FTC has also stepped up its enforcement actions accordingly. This doesn't mean that thousands of lawsuits were filed -- but it does mean that the FTC has almost doubled its case load in the last three years. In the last three years it has filed ten suits against debt collection companies, as compared to six cases in the previous three years.
Obviously, there is a lot of room for private lawsuits against debt collectors that are behaving badly. Statutes including the Fair Debt Collection Practices Act and the Illinois Consumer Fraud Act provide private causes of action for individuals that have been harmed by the practices of unscrupulous debt collectors. Additionally, individuals in a bankruptcy can attack debt collectors in the federal bankruptcy court when creditors violate the automatic stay or the bankruptcy discharge. Many debt collectors assume that so long as they collect on a few debts, it doesn't matter how they go about collecting and from whom.
If you believe that you have been harassed by a debt collector, you may want to consult with a local attorney who is experienced in consumer defense and bankruptcy issues. Sadly, the only way to make debt collectors stop is to either pay them or sue them.
Even though the number of bankruptcy filings are on the rise, debt collectors have not adapted to the new financial landscape. Instead of obeying the law, many will continue to attempt to collect debts during the automatic stay and after the discharge. Many people do not know their rights, or do not have a bankruptcy lawyer who handles adversarial proceedings.