The Economy: Don’t Pick Up the Phone

[Earth Bound Misfit]

The tanking economy isn’t exactly your fault, but America’s biggest debt-collection company — headquartered in Horsham — will still hunt you down
By Jason Fagone

THE CALL CAME on a Saturday morning, 8:30 a.m. Tara Burkholder remembers the time so precisely because the call woke her from a dead sleep. The lady on the other end of the line was from a company called NCO Financial, Tara says. The lady didn’t give her name. No pleasantries, no how ya doin’. Straight to business. She wanted Burkholder to pay back a $9,000 educational loan that her husband, Ryan, had taken out a few years earlier. “I told her, I’ve got $92 in my checking account, two inches of milk in the fridge,” Tara recalls. “It just ain’t possible.”

This was back in April. Times were getting tough. Tara, then 30, had no income. She was a student teacher in Georgia, working for free in hopes of landing a full-time teaching job. Her husband was a lawyer in civilian life, but at that moment he was half a world away, deployed in the Iraq war, helping Iraqi judges restore order in a violent region east of Baghdad. Until he came back home, to the Fort Benning Army base, Tara had to watch her budget carefully — and food for her daughter came first, before any loan repayments. Tara explained all of this to the NCO lady, but the NCO lady was unsympathetic, Tara says. The NCO lady told Tara it was time for her to give up on her dream of being a teacher, and get a paying job immediately: “Honey, sometimes we have to do things that we need to do.” The lady also told Tara that NCO had contacted her husband’s commanding officer in Iraq, and that if she didn’t pay back the loan, her husband would be dishonorably discharged from the Army.

snip

The world headquarters of NCO happens to be in a long, single-story building out in Montgomery County, hidden in plain sight. To look at it, you’d never guess that NCO is, in fact, the largest bill collector in the world — a corporate alpha dog disguised as just another puppy. NCO boasts 30,000 employees, yearly revenues of $1.6 billion, and 120 locations (mostly call centers) in the likes of Antigua, Australia, Barbados, Canada, India, Panama, Puerto Rico and the U.K. It’s the leader of a powerful industry whose highly sophisticated modern incarnation it helped to create. It’s huge. And it’s ours.

Now, as America slouches into a new Great Depression, we’ve got a piece of the action. Now, when the banks fail, and the car companies fail, and even pretty healthy companies find they need to collect on their past-due bills just to make payroll, they’re going to call NCO, and NCO’s going to call you. And whether you like it or not, you’ll have a new friend in Pennsylvania.

snip

The first employee was the company’s founder, Michael Barrist. Barrist was young. Remarkably so: a CEO at age 25. But he had a powerful idea. He had grown up in Havertown, where his parents ran a small debt-collection company out of their converted garage. Most debt companies were mom-and-pop operations. Barrist dreamed of bringing the industry into the age of computers and databases and offshore call centers. The time was ripe. All over America, people were flashing plastic. It was the dawn of the credit-card era. In 1952, according to a report by the think tank Center for American Progress, American families had less than 40 cents in debt for every dollar of disposable income; basically, for every buck in their wallet they could spend on food or gas or a new TV, they owed 40 cents to stores or banks. Manageable. Reasonable. But by 1990, it was 80 cents in debt for every dollar of disposable income. (By 2007, it was $1.34 in debt for every dollar.) Suddenly, organizations of all kinds — department stores, sports teams, dentists, surgeons, colleges, municipalities, even the federal government — found themselves unable to deal with the flood of consumers who owed them money.


snip

This month, President Barack Obama will be sworn in, and life will get more difficult for debt collectors; the federal laws, which haven’t been substantially revised since they were enacted, when Barrist was a teenager, are about to be tightened. What this means, for someone like Tara Burkholder, is that help is on the way. The next call from NCO is likely to be a little bit nicer, a little bit sweeter, a little bit gentler. And what it means for Michael Barrist — this guy who built a billion-dollar company by predicting and molding the sorts of consumer behaviors that nobody else wanted to deal with — is that maybe it’s a good time to diversify into businesses “that are not directly tied to consumer behavior.” NCO has all these call centers, see, and many don’t have anything to do with debt collecting. They’re just buildings full of phones and headsets and Successories posters. You call a company about something you bought. You think you’re talking to the company. You’re not. You’re talking to an NCO employee. This may be the debt collector’s greatest trick. Envy his wiliness, his resilience: To wait out the coming Depression, he manages to disappear

More at link: http://www.phillymag.com/articles/the_economy_dont_pick_up_the_phone/page1

[ZombieHorde]

1. If a telemarketer or debt collector calls you,

politely ask them to hang on, then set the phone down and walk away.

[Myrina]

2. Good idea!

In the past, I've answered the phone and said 'She's not here' or 'Sorry, wrong number, I don't know who that person is'.


:shrug:

[Earth Bound Misfit]

6. Heh Heh...

Maybe set it down next to a TV blaring infomercials- "HI, BILLY MAYS HERE..."

[pacalo]

7. Perfect -- I can't stand his voice!

[TahitiNut]

11. Exactly. I've done that for quite a while and it sure cuts down on the calls.

They're deaf to the "Do Not Call" list and the number that comes up on 'last call' is useless. (Ever try to file a charge on these people?)

So ... I sound eager. I eagerly ask them to hold while I get the information. And leave it there.

ONCE ... after I hung up the phone that had been laying there for about 20 minutes, I got an immediate call back. The fellow said we'd been cut off by mistake. I asked him if he'd held for all that time. When he said yes, I laughed and told him he was a fool for violating the "do not call" list and a bigger fool for just sitting there. And hung up.

:rofl:

[ejpoeta]

14. my husband listens to these calls that a guy posts online....

where telemarketers call and he pulls pranks on them. i am not sure where they are, or i'd post a link. they are kind of funny, though.

[Bonhomme Richard]

3. A telemarketer called me and I asked if he was going to pay...

by visa of mastercard. The guy started stammering what, what.... I asked again which card he was using and he said he wasn't using a card. I told him that my time was valuable but I would be willing to speak with him if I also got paid and that we could charge it to his credit card.
He hung up.

[Earth Bound Misfit]

12. I remember Seinfeld did something like that too in one his show's episodes

[tabbycat31]

4. I used to work as a debt collector

and I am familiar with NCO as our companies did business together.

It had to be THE worst job I ever had, and I was an inbound call center person. The last straw was when someone called me the C word (I put my notice on my break)

[blue neen]

5. What an eye-opening article.

It's hard to judge, but I really don't think I would have the *'s to work for NCO.

[Stand and Fight]

8. Interesting look at Michael Barrist's campaign contributions:

Contributed to both McCain and Obama in the PRIMARIES. $10,000 and $2,000 respectively.

Link:
http://www.campaignmoney.com/political/contributions/michael-barrist.asp?cycle=08

[Earth Bound Misfit]

9. Thank you, I didn't think to look at that n/t

[Samantha]

10. I screen all calls coming in on my landline - I don't pick up

anything until the call starts broadcasting over my answering machine and I recognize the voice. Personal calls come into my cell.

I have been doing this since 1992. Works great. I spend zero time talking to marketers, etc.

Sam

[ejpoeta]

13. when a creditor calls you.....

under the Fair Debt Collection Practices Act (FDCPA]) http://www.google.com/url?sa=t&source=web&ct=res&cd=1&url=http%3A%2F%2Fwww.expertlaw.com%2Flibrary%2Fconsumer%2Ffair_debt_collection.html&ei=kfmjSYytBMiRnge-nqWnBQ&usg=AFQjCNFJp9iw1DEerkcff3MXCwlny5lg8w&sig2=R1AqAChYwW1SYwjU91MNJQ you have a right to have them send you proof that you owe them anything. First and foremost, give them notice that you want them to send you a validation letter. they cannot continue collection activity until they provide this information to you. generally, they just send you a bill. but that is NOT a validation letter. To follow up, you want to send them a request for validation by mail and be sure to send it registered so you have proof that you sent them a request for validation and it was received. You can also demand that they stop calling you on the phone and that they only contact you via mail. That is your right. please check out [i>Maxed Out, a very good documentary about the credit industry.

Secondly.... There is a statute of limitation on collections. This varies depending on state, but is generally 7 years. These third party agecncies purchase debt for pennies on the dollar and then inflate the amount you supposedly owe to get the most they can. The statute of limitation may have run out or be close.

as far as sales calls.... you can tell them to remove you from their list. if they don't they can face fines if I am not mistaken. There is also a 1 800 number that you can call to be on the do not call list. you need to call it from the phone you want to add to the list. so if you have more than one, you will have to do it for each phone. or i guess you can do it online, as i just googled do not call list and got this site: https://www.donotcall.gov/

[KharmaTrain]

15. VERY Important Points...

They can say they're collecting, but how do you know? They need to prove it to me in writing. It's just like when I used to get solicitation calls, I'd never assent to anything or give money over the phone, I'd ask for something in writing. That usually frustrated them.

At one time I had to deal with collectors...and it's a dehumanizing experience in good times, I can only fathom the frustration and anger it's generating these days. To those who are stuck with debt, the sooner you can bail, the better as the predatory lending has gotten out of control and still hasn't been reigned in. This mess is so deep it's gonna take a while for that to happen.

What's really needed is to repeal the 2005 Bankruptcy bill that let the creditors set predatory rates and to do so without any rhyme or reason. If you made a late payment to one creditor, that information is now shared and others can raise your rate based on that "default".

[ejpoeta]

16. well, it's not like we don't know whose running the show.

we have the industry writing the bill. banking/credit industry writing bankruptcy bill. is that not just WRONG!!! our officials aren't working for us. they are working for the corporations. that infuriates me to no end. they are supposed to be representing the american people not the corporations.

[KharmaTrain]

17. It's Hard To Face The Cruel World

While that bill had no affect on me directly, I detested that bill and condemn those Democrats that voted for it. It was obvious at the time that it not only allowed the foxes to run the henhouse by writing the legislation, but it was going to push people to the breaking point. How the hell could someone who was having troubles making payments on an 8% loan gonna do better on one jacked up to 20% with no redress. It wasn't long after that the worst of the sub-primes were written and then began exploding. And that doesn't take into account the derivitive games the banks played with mortgages and the wadload of fees people made in the wheeling and dealing. Yep...it infuriates me no end as well.

In many ways, this day was coming and inevitable and many thought we were "too smart" for it not to happen. Now this country is being dragged down by corporates too big to fail...and by politicians with long histories with those corporations. I just hope for the best.

[ejpoeta]

18. and the passing of the bill gave credit card companies and banks

license to send out credit card offers and such carte blance because they knew the consumers had no way to get out of it if they got in over there heads. and the banks could loan money to people who couldn't afford it for homes, because consumers had no protection. That bankruptcy bill just made the banks less careful than they would have been had they had people who could be protected from them.

[Earth Bound Misfit]

19. Derivatives... tick...tick...tick...

http://www.cbn.com/CBNnews/344995.aspx

Derivative Dangers Threaten Global Markets

CBNNews.com - Add up the gross domestic product for all the world and it comes to about $50 trillion. But now there's a wild trade going on between investors in something called "derivatives" that adds up to more than $700 trillion.

Derivatives So Large, It Threatens Markets

Some people are worried this massive trade in derivatives is so big, so widespread, and in some cases, possibly so dangerous, it could seriously threaten the world's markets -- and your pocketbook. Phil Kerpen, a policy analyst at Americans for Prosperity, a group promoting free markets, said that if you go back a few centuries, you'll find the origin of derivatives was innocent enough: farmers wanting to protect the price for their crops.

snip

Derivatives More Complicated, More Lethal

And over the decades, derivatives have grown more and more complicated. Some of the deals are now so complex, firms must hire NASA physicists or top-flight economists just to manage them, or to figure out new derivatives. But the trade has grown so big and is carrying so much risky debt, that one of the world's savviest investors of all -- Warren Buffett -- labeled derivatives "financial weapons of mass destruction, carrying dangers that... are potentially lethal."

snip

Derivative Disasters in the Headlines

Beleaguered Bear Stearns was deep into derivatives. The Federal Reserve jumped in to prop it up and arrange its quick sale because so many other entities could have been seriously hurt financially if Bear went out of business and couldn't pay its debts. That could have started a chain reaction across the trading world, bringing down other firms as well.

ETA: :nuke:

[dgibby]

20. FWIW,

They are NOT allowed to call you at work. If they do, tell them to cease and desist or you'll report them. It's considered harassment.