McLeod Law Offices

In November of last year, I wrote an article highlighting what I perceived to be some of the weaknesses in court rules that are exploited by unscrupulous debt collectors, their attorneys and their agents. I also pointed out in April that in Maryland, debt collectors were indicted. Those collectors were engaging what is called “sewer service”: representing to the court that a defendant had been served, when in fact they were not. The term “sewer service” is derived from the presumption that the process papers are tossed in the sewar, rather than properly given to the defendant.

Following last week’s series on the debt collection system in Massachusetts in today’s Globe, Warren Fitzgerald, president of the Massachusetts Bar Association had this to say:

An amendment to current small-claims rules may be required to ensure that notice requirements are meaningful. In terms of professional debt collectors, requiring them to serve personal notice on an individual who allegedly owes money may be necessary….Collection agencies and their attorneys have every right to pursue people who owe money, but they must do so lawfully. Lawyers in particular are governed by ethical rules that clearly prohibit some of the conduct described in the Globe series. If some lawyers are not obeying the rules, they should face disciplinary charges. Such behavior is an embarrassment to the overwhelming majority of lawyers in Massachusetts who are honest and ethical.

Was the Boston Globe’s four part series this week was just the wake up call that elected leaders needed to seek a revamping of the debt collecting industry? In what appears to be a collective quest to do away with the wrongs cited in the reports, leaders including state attorney general and gubernatorial candidate Tom Reilly to Boston Mayor Thomas Menino are vowing to seek various changes in response to the report.

Too little, too late.

Lieutenant Governor Kerry Healey, the presumptive Republican nominee for governor, said Reilly “has failed to do enough to protect consumers in Massachusetts.” But Healey also found fault with the state court system. It has been, she said in a statement, “too lax, loosening notification rules for debt collectors instead of enforcing them to protect average citizens.”

Deval L. Patrick, one of two Democrats vying with Reilly for the Democratic nomination, was less direct in his criticism. But he said the lack of enforcement is stark evidence that, “at both the federal and state level, the government is on the side of the big players, and not the little guy.”

Harvard Professor Elizabeth Warren comments Harvard Professor Elizabeth Warren comments on the four part Globe series I have written about here:

It isn’t just the debt collection agents who get a black eye in this series; it is the government officials who are charged with the responsibility to watch out for the public and who instead made themselves the dupes of out-of-control debt collectors.

Do three things: First, read the series. Second, drop an email to the Globe to tell them what you thought—this makes a huge difference on the amount of follow-up reporting. Third, post a blog here about what you thought was the most outrageous act or your view about what is happing.[sic]

I want to taste this awful stuff one more time. The people who were featured in the Globe articles deserve at least that much, and the officials who didn’t help them deserve so much more.

If Professor Warren’s weblog is not in your favorites yet, it should be.

The final of the four part Globe Spotlight series, Debtor’s Hell, asks if regulators and legislators (and in some case gubernatorial candidates) unaware of the debt collection industry’s free-for-all or are they simply unwilling to act.

Unwilling? Or simply uncaring?

Every person who comes before the courts in Massachusetts has the right to be treated with dignity and respect, to be accorded an opportunity to present his or her case and to have that case decided in a way that is fair, impartial, and timely. The Boston Globe’s report on debt collection in small claims sessions of the District Court focuses attention on an “industry which has swamped the court dockets with lawsuits.”

The rest is here

The third Globe installment focusing on the hell debtors go through looks at constables as well as county sheriff offices.

The office of constable is as ancient as it is obscure, governed in Massachusetts by laws that date back to the 1600s. One power of the office – never repealed – is to ”take due notice of and prosecute all violations of law respecting the observance of the Lord’s day, profane swearing and gambling.”

Nowadays, constables, and the deputy sheriffs who perform parallel work, busy themselves delivering subpoenas and other court papers, placing liens on real estate, and seizing personal property to satisfy court judgments – in the case of constables, judgments of no more than $2,500.

Where they differ is in accountability. Constables, for example, can legally operate only in the communities that license them. But that restriction, the Globe found, is often ignored.

Today’s Boston Globe installment (the second of a four part series) focuses on the Massachusetts Court system.

[The small claims session] is a de facto arm of a fast-growing and aggressive industry that has swamped court dockets with lawsuits – cases that often lead to threats of jail for debtors.

* * *

A Globe review of proceedings and records in 20 of the state’s 70 small-claims courts found that court officials and collection lawyers routinely break court rules, almost always to the detriment of the defendant. Collectors are almost never asked to prove the debts they claim; defendants are rarely informed of their rights. And debtors, usually too strapped to afford a lawyer, must contend with this legal mismatch alone.