Debt Tagging – The Newest Craze

I Am Being Garnished For What? Recently, someone sent me a story in the Orange County Register about California State Senator Lou Correa who received a phone call from his payroll department at the state informing him that they received a wage garnishment as a result of a judgment against him.   He thought it was a joke but soon found out that it was very real.  The debt was actually owed by someone with an almost similar name.  Sen. Correa even previously told the debt collector that the debt wasn’t his but that didn’t seem to matter or stop the debt collector from issuing the wage garnishment against the Senator’s wages.  For their troubles, the debt collector’s action caused the Senator to plan to convene a hearing on debt collectors and the practice of “debt tagging”.  Debt tagging is the practice of collecting a another person‘s debt from you.  For those interested in the story, it can be found here, http://taxdollars.ocregister.com/2011/06/03/debt-collector-erroneously-garnishes-oc-lawmakers-wages/84371/.

Another case of debt tagging was also just reported where the wrongfully garnished debtor sued the judgment creditor and its law firm for twice attempting to garnish the plaintiff’s wages, including a successful second attempt that resulted in a wage garnishment even though the creditor’s law firm failed to attend a required hearing.  This is an even more egregious case because the law firm collecting on the debt was informed by their own client that the law firm was going after the wrong person. The jury awarded the plaintiff $1.26 million for being subjected to this harassment.  The link to this story is supplied here, http://www.collectionscreditrisk.com/news/woman-awarded-in-collection-wage-garnishment-case-3007259-1.html

I know that it sounds unimaginable that you could have your wages garnished for a debt that is not yours but sadly, this is happening to people around the country on an all-too-frequent basis.  Debt collectors will take action against someone with the same or similar sounding name hoping that the person who bank account they levy or whose wages they garnish, will not fight the garnishment or levy.  This conduct is illegal and has gotten at least two creditors in the news.

While I encourage the California State Legislature and all other legislative bodies to make these recalcitrant creditors responsible for their actions, it is clear that the only way to change the practice is by bringing an action against these collection firms and make them pay for their conduct.   The more that the court system sees that this illegal conduct happens with regularity, the more opportunities juries will have to make the creditors pay for their actions.

If you are the victim of debt tagging or other creditor abuses, please call my office for a free consultation.