Social Security stops trying to collect on old taxpayer debts

[DonViejo]

Source: Washington Post

The Social Security Administration announced Monday it will immediately cease efforts to collect on taxpayers’ debts to the government that are more than 10 years old.

The action comes after The Washington Post reported that the government is seizing state and federal tax refunds that were on their way to about 400,000 Americans who had relatives who owed money to Social Security. In many cases, the people whose refunds were intercepted had never heard of any debt and the debts dated as far back as the middle of the last century.

Read more: http://www.washingtonpost.com/politics/social-security-stops-trying-to-collect-on-old-taxpayer-debts/2014/04/14/9355c58e-c40f-11e3-bcec-b71ee10e9bc3_story.html

[Fred Gilmore]

1. Good News, But........

The SSA has got to do something to make up for all of the tax-dodging 1%ers who claim Capital Gains income and pay no SS taxes, yet are allowed to collect SS when they retire. Just another way that the 1% is scamming the average Joe.

[Travis_0004]

3. They don't collect SS based on capital gains

If somebody had 0 income (all capital gains), then they would not be eligable for social security retirement. They only collect social security income based on their earnings that were reported to social security.

[jtuck004]

2. Great. AFTER you got my dad's $140 from 19 and Seventy Two. Last year. <G> n/t

[rickyhall]

4. Now if only they'd blow off student loan debts over 30 year old I'd be happy. . .

D of Ed has been taking my tax refunds since 1982.

[Spitfire of ATJ]

6. Yet another example of a scam. Judges will allow a private collector to garnish wages,...

....and NONE of the money they steal goes towards the principle. They will claim it was used for late charges and other fees.

The idea is to NEVER pay off the loan but to treat it like an endless revenue producer.

[Spitfire of ATJ]

5. Now let's see them chase after these collection agencies trading in expired debt....

How many here have had a call from some place claiming you owe on something from over a decade ago?

They sometimes will claim the bill is for some jaw dropping amount but they will settle for a fraction of that.

[freshwest]

7. That's a zombie debt collector. They buy the paperwork for pennies on the dollar of the debt that

has already been written off by the lender. Anything they get over the pennies is pure profit.

Never talk to, answer mail or anything like that, as they will just act crazy. It's a scam that only works as a threat. The original lien holder or creditor never sees a dime, or so my attorney told me.

I'm not giving you advice, as you didn't complain of it happening to you, just general information.

Although the GOP changed bankruptcy laws numerous times during the Bush era. Ted Olsen his Solicitor did a job on SSA dependents, by claiming that the money didn't belong to the child.

I forgot how that lawsuit won the case, but they did. I remember reading it and getting furious. It appeared his interpretation was that SS is charity.

Who says that? Rushbo.

And it appears to insult the people who'd paid in and expected their survivors to get what they'd worked for, up until age 18+. AFAIK, the Bush administration gave the green light to garnish SS, even disability, to pay student loan debt.

Until we get a HoR and if we keep the Senate, the student loan scam will continue. Obama and Warren worked on keeping an increase from going in, but the basic problem still remains, paying a private entity who profits off a public good.

At one time, the rates were low and were amortized, then they turned them into something like a revolving credit card account. And the profit does not go to the government, it goes to the lenders, who get paid first and foremost. I only had one brief student loan under the new regime, and fought hard to get it paid off, a very tiny one it was.

One has to watch out, I was harrassed for a loan that I applied for years before but was never approved as I didn't complete the process. No money was released for anyone. A computer based program found the app and tried to dun me for it. I went in person to see their paper trail to prove I'd gotten the money. They looked and saw it'd never been paid.

This is main thing to fear about paperless transactions in my mind, especially if they are large sums.

[Spitfire of ATJ]

10. We need to hit these guys the same way the "Do Not Call List" hit sales calls.

[freshwest]

12. Well, really it is a sales call, you know.. n/t

[Spitfire of ATJ]

13. It's also interstate fraud so the feds are the ones to stop it.

[freshwest]

14. Oh, no, they bought the data fair and square. Here's some details:

Attack of the zombie debt...

The anatomy of zombie debt

Who makes debts come back from the dead? Debt buyers. "They buy debt really cheap, paying pennies on the dollar," Rheingold says. A debt could lie dormant for months or years before being purchased by a debt buyer, who then might either start trying to collect the debt or hire a collection agency to do so...

Now debt buyers snap up old debt in bulk from credit card companies, gyms, public utilities, cellphone providers and other creditors, experts say, and their business has been growing steadily. The debt-buying industry began to take off in the late 1980s when a U.S. government- owned asset management company sold delinquent credit card debt to help fund the cleanup of the savings and loan crisis, in which hundreds of financial institutions failed, according to Mike Ginsberg, the president of Kaulkin Ginsberg, a company that provides strategic advice to debt buyers and collection agencies....

Zombie debt can cause mayhem

...In fact, in January 2012, the U.S. Department of Justice, at the request of the Federal Trade Commission, sued one of the biggest debt buyers in the country, Asset Acceptance, alleging it violated the federal Fair Debt Collection Practices Act and other laws. According to the lawsuit, the debt buyer made deceptive statements to consumers, gave false reports to credit-reporting agencies and committed other violations. In response, Asset Acceptance agreed to pay a $2.5 million civil fine.

Problems for consumers start with the way companies buy debt, experts say. Instead of purchasing complete files with full documentation, they often buy electronic records that contain scant information, experts say. "It's just a stream of numbers -- a name, maybe a Social Security number and an amount of money," Rheingold says. "There's no paperwork whatsoever..."

Out-of-statute debt collection

Finally, debt buyers sometimes illegally sue or threaten to sue a consumer after the state statute of limitations has run out, experts say. "There are allegations that debt buyers do this at a higher rate than other debt collectors," says Jason Schall, an attorney with the FTC, which is conducting a study on the debt-buying industry. Debt buyers count on consumers not showing up to court -- either because they're working, they don't have time or they never got served, Rheingold says. If the consumer doesn't show, he says, the debt buyer likely will get a judgment against the person...

Consumers have to keep watching over their shoulders for zombie debt, experts say, because old debt will probably continue to be big business. Rheingold says, "Debt buyers are buying this debt really cheap, and they're making enormous profits."

More at link:

http://money.msn.com/debt-management/attack-of-the-zombie-debt

Another gift of the Reagan era. The precedent was set during then by a contracted federal agency because of the scam pulled by the Keating Five, with such names as John McCain and Neil Bush involved.

And it's all legal since they did pay... To most of us this is a scam and fraud. We wouldn't be allowed to do this without being taken to court for such a stunt.

I know someone who had credit card debt of $3,000. and felt the right thing to do was to negotiate with them. She'd paid off her tiny home and been trying to sell it with no buyers. So it was worth little to nothing on the market.

But it was assessed at 15X her $3,000. They dragged her to court and put a lien on her house. All nice and legal, so she's just kind of getting by with her SS check which doesn't leave enough to pay the debt, and now she can't get her equity out of the place to move.

Trapped as a senior in an area with no jobs, a house that has no market value, and a debt that won't let go. She can't afford to live elsewhere at her income, but can stay at her home as there is no housen note. There are much worse situations from this.

There was a piece some years back about people who had been arrested for contempt of court for not being to pay these crooks who took them to court. A bench warrant was issued but they hadn't really been in touch with the debtor, they didn't send them notice. Add to that the problems some have with transporation, and they are screwed.

So they were now not able to work as they were in jail, their lives in chaos. There has been pushback, but right and wrong and the law at times are not the same time at all.

FYI:


7 steps to take if chased by zombie debt

http://www.creditcards.com/credit-card-news/7-tips-steps-chased-zombie-debt-1282.php?a_aid=46bf5df1

More on what is planned for America, being enacted in many states, and this is just the last bullet point:

“We support the repeal of all state usury laws.”

The rest of it is just as hair raising, in fact more so.

http://www.democraticunderground.com/10024806298

http://www.sanders.senate.gov/koch-brothers

http://www.historycommons.org/context.jsp?item=a7980koch

[dflprincess]

8. Or the ones that go after surviving relatives for a debt the dear departed owed

I got several calls from one outfit after my brother died (not sure how they tracked me down). They pretended to be shocked, shocked that I had no interest in paying his $600 something credit card bill. One was truly taken aback when I said commented that he owed me money for his funeral.

I'm just happy they didn't get hold of my mom - it would have upset her while I just saw it as scam and had some fun tormenting the caller. I didn't hear from them again after I said I was calling the state AG's office after we hung up (I didn't).

A while later there was an article in the paper about these outfits and how they do really like to get hold of an elderly parent and harass them. Fortunately, we in Minnesota do have an AG who doesn't put up with this crap and was going after them (MN has some strict laws about what debt collectors can do to anyone and they are enforced).

[Spitfire of ATJ]

9. Some of these guys will even tell you that you can go to jail if you don't pay....

I'm sure the Republicans have been drooling over the idea of "Debtors Prison" for us peasants.

[dflprincess]

15. The Nation had an article a few weeks ago about the the new debtor's prison

mostly in the south and having to do with civil fines. I'm not sure if the whole article is on line but here's a link:

http://www.thenation.com/article/178845/town-turned-poverty-prison-sentence


(My apolitical friend Googled "what to give your liberal friend for Christmas" and it came back with a subscription to The Nation or Mother Jones - she picked the Nation. Best present she ever gave me.)

[Spitfire of ATJ]

16. Makes a good gag gift to a Conservative too.

[elleng]

11. I SHOULD have posted that I doubt this would continue

so I could say, "I told you so!" Sorry I didn't!


Grassley said that although Congress did authorize the government to seek payment on old debts, the law “says nothing about allowing the government to offset payments from an individual to pay debts not in his or her name. It is unclear where the government has that authority.”