23 Feb Who is this Unknown Collector that Filed a Proof of Claim in my Bankruptcy?
It happens all the time. Someone files a chapter 13 case, lists their creditors to the best of their knowledge, and all of a sudden it is a feeding frenzy no different than sharks chumming on something bloody at my favorite surf break. But who are these sharks?
Actually, the proper term is Debt Scavengers and I fear them more than sharks in the line up. These companies’ business models turns on buying computer spreadsheets that get merged with Public Bankruptcy Data by computer programs. The end result are thousands of proof of claims which can be filed in bankruptcy cases across the US electronically in mere minutes.
So while you may have listed Sears, Citibank, and a Shell mastercard in your case, instead you now have claims from Asset Acceptance Corp, B-Line, eCast, Resurgent, and the like. The biggest problems with these claims is that most these debts are VERY OLD and past the statute of limitations to collect upon. Of even greater significance, is the fact that these debt scavengers may have the WRONG DEBTOR or may not have even bought the proper account in the first place!
The following is an email exchange I had with one such zombie debt buyer who filed a proof of claim in one of my client’s bankruptcy cases and no such claim was ever listed in the schedules:
Please allow this email to confirm our telephonic conversation today between Ruben of my office and Kathy from your office. The following information was provided:
1) The account has not been assigned to A,
2) B has an agreement with A to put their name under name and address where notices should be sent.
3) B will eventually purchase the account at a later date.
4) At some future date, this claim will be transferred to B.
Obviously, this is of big concern if you are filing proof of claims without any documentation and on behalf of an entity that has not purchased the account yet.
My client did not list your firm, A, or B in the bankruptcy filing. In all honesty, I dont see why this is not a false proof of claim subject to criminal prosecution and a violation of 11 USC 362(a)(3).
Accordingly, please explain how I may be mistaken in this regard.In the meantime, demand is hereby made that this proof of claim be withdrawn and that we receive proof of being a real party in interest as well as the underlying contract and how the balance was computed pursuant to In re Heath and In re Campbell.
To date, I have received nothing. Its very troubling, since in this case, it does not even appear that the debt scavenger even had the right to submit the prof of claim in the first place since they had not purchased the account yet. If this happened in State Court, we would immediately sue for at least $10,000 under the FDCPA!
So ALWAYS, ALWAYS, check all proof of claims filed in your case. Most the claims filed by the debt scavengers are very old and small enough that they fly under the radar. So while its maybe a few hundred dollars to you, its millions to them if you do the math with all the claims filed across the US every year that go undetected!
Your attorney can object to these claims and possibly get you compensated as well!
Written by Michael G. Doan
Bankruptcy Law Network (BLN)
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