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Florida Debt Collection Law Blog

Fraud and identifying a debtor's assets

When it comes to asset recovery, there are many challenges that creditors may face and every situation is different. Sometimes, debtors conceal their assets, which can be very problematic with regard to asset recovery. There are a number of ways in which borrowers may attempt to conceal their assets, from concealing property to hidden financial accounts, and it is imperative for these tactics to be identified by creditors who are attempting to recover debts. Unfortunately, many people have been able to get away with this behavior, which can result in financial difficulties for those who have lent to someone with the belief that the borrower will act in good faith.

There are many reasons why borrowers may try to conceal their assets. Some people feel as if they are owed something, or they may have a sense of entitlement. In some instances, borrowers who are facing financial challenges or who wish to continue living a lifestyle that they cannot afford may do so in an attempt to maintain their quality of life. In some instances, people simply have a hard time parting with certain assets or behaving in a responsible manner.

Emotional challenges and creditors' rights violations

When creditors' rights violations occur, the consequences can be incredibly damaging for those who are affected. Not only can financial consequences arise for creditors who do not receive the debts that they are owed, but the impact of these violations may prompt a creditor to close their doors. Moreover, the emotional challenges associated with various stressors related to this area can be incredibly tough. Depression, stress and even anger can make daily life very challenging for some of those who have been subjected to creditors' rights violations.

Financial strains can be very hard to deal with, and some creditors in this position find it especially hard to deal with their financial circumstances when borrowers fail to live up to their obligations. It can be very hard to obtain debts if a borrower refuses to cooperate, but there may be certain legal options to help creditors through the challenges they are facing. You should not hesitate to consider legal action if you believe that doing so could help you gain access to what you are owed. Moreover, the threat of legal action in and of itself may prompt some delinquent borrowers to pay up.

Defining fraud

Like most in West Palm Beach, you likely consider yourself intelligent enough to spot fraudulent schemes before you can become a victim of them. Many of those with whom we here at CreditorCollections A Law Firm have worked with once felt the same way, yet were unfortunate enough to learn that today's schemers and confidence artists are becoming evermore savvy. If you do happen to fall victim to fraud, then you certainly will want to do all that is needed to recover whatever assets and/or properties that you may have been deprived of. Yet doing so requires that the action taken against you be correctly identified as fraud. 

At face value, the definition of fraud offered up by The U.S. Department of Justice in their Criminal Resource Manual seems extremely far reaching. Indeed, it actually offers no common law definition, instead citing a federal court ruling that states "[t]he law does not define fraud; it needs no definition; it is as old as falsehood and as versatile as human ingenuity." This may create the impression that defining fraud is next to impossible. However, its broadness also allows for other definitions to be applied to it that statutorily designate actions as fraudulent. 

What qualifies as harassment?

No one likes being reminded of the debts that they owe, least of all those whose balances are long past due. As one representing creditors in West Palm Beach, you likely understand this better than most. People may often get defensive when told of their outstanding liabilities, and thus may be quick to accuse you of harassing them. Creditor harassment is an issue that federal regulators take very seriously. Therefore, you will want to be sure that you understand exactly what actions qualify as harassment

Fortunately, federal legislation has left little room for interpretation on what is considered creditor harassment. Indeed, harassing actions are defined very clearly in the Fair Debt Collection Practices Act. According to the Consumer Financial Protection Bureau, these include: 

  • Repetitious phone calls intentionally meant to annoy, abuse or harass
  • The use of obscene or profane language
  • Threatening to use violence against a debtor
  • Publishing information listing people who have outstanding debts
  • Not identifying yourself or your intent when calling

Options for creditors seeking to collect from debtors

When a person owes a debt, he or she is responsible for paying it. In the event that person does not pay, creditors may move forward with a few different options by which they can collect payment. One of these options includes securing the services of a third-party debt collection company.

Debt collectors have limits, and the Fair Debt Collections Practices Act protects the rights of consumers. Before you hire a debt collection company, you will find it beneficial to find out exactly what they can and cannot do on your behalf. Learning more about this process will help you have reasonable expectations and move forward with the course of action that makes the most sense for your company.

Garnishing tax returns

Spring not only brings with warmer weather, but also the tax season. For many creditors and collection agencies in West Palm Beach, this time of year is often as busy one as people often use the money to get back from the government to pay off outstanding debts. Yet some may be less than willing to part with their income tax returns (even if they have debt claims against them). Many creditors often wonder if the collection assistance offered through a garnishment can be applied to tax returns. 

The answer to that question is yes...and no. Only state and federal agencies have an automatic right to garnish tax returns. According to Intuit, there are a select few other types of debt that do allow those collecting on them to seek a tax return garnishment. These include: 

  • Unpaid taxes
  • Child support arrears
  • Debts owed to local governments

Collecting on a judgement in Florida

At CreditorCollections, A Law Firm, we understand that failure to recoup your money could mean going out of business. Because of this, creditors are often compelled to involve the state to recover commercial debts when borrowers are either unwilling or unable to repay the amount owed. But how? The Division of Corporations at the Florida Department of State explains.

According to the DOS, creditors are not obligated to file a Judgment Lien Certificate, but it can make recovering your debt a whole lot easier. Why is this? The sheriff's department is responsible for ensuring creditors receive their payments. However, the debtor may owe several other creditors. As a result, the sheriff operates on a first-come-first-serve basis, decided by who first filed their lien.

Debt collection and fraud

For debt collectors, recovering assets can be challenging in many different ways. However, there are times when it can be especially difficult to recover debts, such as instances where a debtor intentionally does everything they can to evade debt collection through fraudulent activity. For many debt collectors in Florida, this is a reality that is all too common, and a number of roadblocks may emerge when fraudulent behavior is present. However, it is extremely important for creditors to recover what they are owed and for fraudulent debtors to be held responsible for their actions.

When it comes to debt collection, every case is different, and this is especially true with regard to fraud. Creditors should not hesitate to pursue legal action against a borrower who has intentionally misled borrowers and evaded debt collection through fraudulent means. Before moving forward with legal action, it is critical to be prepared and gather as much relevant information as possible. Even seemingly small details could impact the case, and there are many different issues that will need to be reviewed.

Options for collecting debt before going to court

For your Chicago business, the collection of debts is crucial to the financial health of your company. It is important to secure what customers and clients owe you, and it is helpful to know how to do this in ways that are as simple and effective as possible. Creditors have certain rights, and there are options for debt collection that may benefit your company. 

When Florida customers fail to pay their debts, you can take specific steps to collect what they owe, sometimes with interest. There are remedies available to you, some of which you can do yourself and others that you can do with court involvement. Many Chicago companies find it beneficial to work with a legal professional experienced in debt collection matters.

Involuntary bankruptcy basics

The popular opinion that many in West Palm Beach may assign to bankruptcy is that it is simply a way for individuals or businesses to avoid having to their debts. While many of those who seek bankruptcy protection are legitimately in a position where they cannot afford to meet their liabilities, the concern of creditors that debtors might purposefully be avoiding paying them may be legitimate. Knowing this, the federal government has structured the bankruptcy code in such a way as to prevent the privileges of bankruptcy from being abused. This includes allowing creditors to force debtors into involuntary bankruptcy

By initiating an involuntary bankruptcy against an individual, creditors are essentially saying that they believe a debtor is capable of paying their bills, yet they are avoiding doing so. Indeed, as the Involuntary Petition Against an Individual form (as shared by the Federal Judiciary) shows, the allegations that a creditor must cite include a debtor generally not paying debts as they become due (the other is that a debtor has transferred property subject to a lien to a custodian to try and protect it from creditors' actions). 

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