Look at this Chairmans proposal! It is so out there that it may just blow the entire bill! To view the entire article, go to http://www.washingtonpost.com/wp-dyn/articles/A52769-2000May11.html Hatch Seeks Fewer Curbs On Debt Collectors Senate Judiciary Committee Chairman Orrin G. Hatch (R-Utah) has proposed amending bankruptcy legislation to allow debt collectors to use techniques that include telephone calls in the middle of the night, bogus threats of prosecution and hundreds of dollars in fees when consumers fail to make good on bounced checks within 30 days.<P> The amendment would exempt debt collectors from the Fair Debt Collection Practices Act when they are trying to collect on bounced checks that have been outstanding for 30 days or more after a bank has notified a consumer that there were insufficient funds in his or her account. The exemption would permit collectors to use techniques that are now outlawed when they push to collect tardy payments on credit-card balances or mortgages.<P> Aides to Hatch say the amendment would make it clear that checks are not forms of credit, as is a credit card, and therefore should be covered by the debt-collection law only for a short period. Most courts have ruled that bounced checks qualify as debt under the act, a position supported by the Federal Trade Commission, which enforces the collection law.<P> Many Democrats and Republicans oppose the Hatch amendment, which has not been publicly debated. Some lawmakers fear that Hatch's amendment could kill the bill outright by wrecking a delicate, hard-won compromise that the House and Senate have crafted in the past few weeks on consumer-protection provisions. One such provision would require that retailers and other creditors make it clear to consumers how quickly interest on debt accumulates over time. <P> But the two sides remain at odds on several key issues. These include how valuable a home a bankruptcy filer should be allowed to keep and how courts should calculate whether a consumer can afford to repay some debt.<P> Controversy over the Hatch amendment could further hinder progress on the bill. Opponents, such as Sen. Paul S. Sarbanes (D-Md.), argue that the exemption would be unfair to consumers. In a recent letter denouncing the Hatch amendment, Sarbanes noted that it would permit "unfettered collection activities" as well as legal action not only against criminals who forge checks "but also against the consumer whose checks have been forged."<P> The debt-collection law "protects consumers from invasion of privacy, harassment, false or deceptive representations, unfair or abusive collection methods and illegal fees," Sarbanes wrote in the letter to Sen. Patrick J. Leahy of Vermont, the ranking Democrat on the Senate Judiciary Committee, which oversees bankruptcy legislation.<P> "It does not prevent the collection of a valid debt," Sarbanes wrote. Leahy, on Sarbanes' behalf, has in turn objected to Hatch's amendment, warning it could torpedo the bill.<P> Aides to Hatch say that 30-day-old bounced checks need to be exempted from the debt-collection law because many consumers unfairly hide behind the act to delay or refuse paying money owed.<P> Margot Saunders, managing attorney at the National Consumer Law Center, a nonprofit law firm that represents low-income people on consumer issues, said few people abuse the law and that even with the 30-day grace period there is ample room for abuse by creditors.<P> She cited cases in Utah where people have written checks for less than $25 and have been threatened with criminal or civil prosecution unless they paid several hundred dollars in fees to the debt collectors, a practice she said federal courts have found to be excessive and illegal.<P> Saunders said there are many times when consumers bounce checks for reasons beyond their control, such as having relied on a deposit that bounced or having been robbed by a fraudulent check writer. And there are other cases where debt collectors go after the owner of the account even though a check forger, not the owner, wrote the check that bounced, she said. In such instances, she said, the debt-collection law is used to block such actions.<P> The Senate passed its bankruptcy bill in February, and the House passed similar legislation last year. Both bills would generally make it harder for consumers to wipe out debt through bankruptcy. But complicated parliamentary rules have so far enabled opponents of the bill to block the House and Senate from convening a conference to reconcile differences between the two bills.<P> In the meantime, lawmakers have been working behind the scenes to craft a compromise that both chambers could approve and send to the president once parliamentary roadblocks are removed.<P> Senate Majority Leader Trent Lott (R-Miss.), House Speaker J. Dennis Hastert (R-Ill.) and other Republican leaders yesterday afternoon asked their staffs to reconcile the two bills by early next week. If an agreement can be reached on the issues, then the leaders will work to remove the parliamentary holdups on the legislation.<P> Retailers and credit-card companies are pushing for the legislation to plug what they see as loopholes in current law that permit consumers who could pay off some of their debt to get off the hook completely when they run into trouble.<P> Consumer groups, several Democrats and the White House have argued that the bills are overly harsh to consumers. They argue the legislation should contain stronger consumer protections to counter the credit industry's aggressive marketing techniques, which bill opponents say bear a large responsibility for getting Americans in over their heads in debt.<P>
RE: More Debt Collector Rights Scary!! I wonder how this would affect the CRA's, though. (Such as Chexsystems!) If it's not "credit", then would it be legal to have it listed on a credit report? Or would bad check writers end up in court more often? (I'd have gladly gone to court and on probation rather than be blacklisted for five years!) Just a question. -melissa P.S. The lobbyist bribing Hatchett must have bounced the check, huh?
RE: More Debt Collector Rights I've never understood bounced checks going to collection agencies anyway. I'm not sure how it works in other states, but here in Texas, writing a hot check is a criminal offense and they'll haul your ass off to jail for it. When a merchant receives a returned check, he/she attempts to notify the person and gives him/her a certain number of days to make good on it. If that fails, the merchant turns it over to the District Attorney's office who makes a second attempt to collect. When that doesn't work, the DA files charges for theft, and arrest warrants are issued. I live just outside Houston, and I've seen on the evening news some of the round-ups the sheriff's department does on occasion. They bust people on their jobs and other really embarrassing places. I'm not sure how well it works, but I'll be damned if I'll ever write a rubber check! When I worked for a local affiliate of Trans Union, part of my job was to collect on bad checks. The hotties came directly to us from the bank, bypassing the member merchant. I gave them from 5 to 10 days to cough up restitution and some ungodly collection fees. When that didn't come through, I had to send it directly to the DA's office. It gets UGLY!
RE: More Debt Collector Rights Our county has a program where the District Attorney uses an outside collection agency to send several scary dunn letters. If still no pay, the DA files charges and mandates a financial management progam as part of the sentence. Some merchants just go straight to small claims court, because here in California, they can sue for up to three times the face amount plus fees. It gets expensive very fast to kite checks!!!