Better Off Deadbeat: Making a Profit Suing Debt Collectors

Craig Cunningham is one of a small group of people who are actually looking forward to calls from debt collectors. Though he made his mistakes (falling more than $100,000 into debt during the housing boom), he’s now finding ways to profit from the mistakes of others: specifically, debt collection agencies.

There are an awful lot of rules and regulations that debt collection agencies need to follow, and the technical “breaking” of these rules can lead to a small, monetary fine.

When asked if a collection agency could garnish his wages if he didn’t pay, the company responded yes; when asked if the company could put a lien on his house, the company responded yes. These particular practices are illegal where Cunningham lives (Texas). Collection agencies can’t threaten legal action that would violate state law.

As a result of this conversation (and a voice recorder to prove it), Cunningham got $1,000 via a lawsuit he filed. After he learned to file without the help of a lawyer, he began to sue more and began to see more of the industry standard settlement of $3,500.

His current lawsuit has him pushing for $200,000, claiming a collection agency violated his rights (all for a $79.84 bill).

I don’t particularly agree with Cunningham’s position of not paying back debt, and absolutely disagree with the logic that’s presented at the end of the article. That said, there’s a macabre kind of fascination with someone who’s been able to find this kind of a loophole, and has exploited things to such a degree.

Here’s the full article, although I highly recommend the printer-friendly page, that’s way less annoying and isn’t split up into 6 separate pages you have to click through.