Man harassed for phantom debt starts a years-long crusade against crooked lenders

Inside Subprime: December 8, 2017

By Alex Huntsberger

This past Wednesday, Bloomberg Businessweek published a story that almost defies belief. Then again, if you’re familiar with the kinds of shady tactics used by certain types of payday lenders and debt collectors, the story might not be so surprising.

The piece, written by Zeke Faux, follows an unassuming 33-year-old copier salesman from Rhode Island named Adam Therrien. After a debt collector threatened to sexually assault his wife while trying to collect on a debt that Therrien had paid promptly and in full many years earlier, Therrien started hounding the collector and the company he worked for. He not only wanted them to leave him alone, he wanted to end their scam once and for all.

Therrien was being menaced by an age-old fraud scheme called a “phantom debt.” Basically, sketchy debt collectors attempt to collect on debts that don’t exist, using fear and aggressive tactics to make people pay up, even when they don’t owe anything.

The scam has been around for hundreds of years, but the technological boom over the past 40 years has made it an even easier con to pull. 

It begins when someone scoops up troves of personal information that are available cheaply online—old loan applications, long-expired obligations, data from hacked accounts — and reformats it to look like a list of debts,” writes Faux. “Then they make deals with unscrupulous collectors who will demand repayment of the fictitious bills.

The piece also discloses how debts get continually packed and re-sold, with many debts ending up in the hands of multiple collectors – all of them pretty dicey. Other practices include “biffing,” or trying to collect on more than someone actually owes, and “redo” lists where collectors just straight up harass people who they know have already paid their debts off.

The world of phantom debt is a sprawling maze of collectors, lenders, lawyers, phony lists, and dodgy brokers. It took an immense amount of will for Therrien to systematically follow each and every thread he found as he worked his way to the top. His skills as a salesman came in handy as he alternatively cajoled and threatened low rankings goons and middlemen until they flipped on the folks above them.

When Faux compares Therrien’s saga to that of Liam Neeson’s character in the Taken films, it’s eerily on point.

Eventually, Therrien’s quest leads him to former Kansas City payday loan mogul Joel Tucker. You might have heard of him or his brother Scott. We’ve written about them before. In 2016, the FTC fined Scott Tucker a record 1.266 billion dollars for his deceptive and predatory lending practices. Just this fall, Scott Tucker and his business partner Timothy Muir were found guilty on criminal charges for their illegal online payday lending business. They will likely spend the rest of their lives in prison.

Joel Tucker is on the hook for millions now, a fine he likely won’t end up having to pay. But Therrien has no plans to stop his crusade. He’s still getting calls from collectors, as well as calls from Joel Tucker, begging him to let it go. Something tells us that’s not going to happen.

To read more about the dangers of payday lending and subprime loans, check out these pages and articles from OppLoans:

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