Guest Editorial
Even today many creditors will argue that they are not responsible for the acts of the collateral recovery specialists they hire to recover their defaulted collateral. Their argument, which the courts disagree with, is that the collateral recovery specialist is an “independent contractor” and therefore must assume the liability associated with the self-help repossession process.
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Steve, I have seen and heard your comment many times. When someone knows for a fact and can demonstrate it, that a forwarding company is using a noncompliant agent then it is their responsibility to report it. On the couple of occasions where a member has brought this information to my attention we have been successful in having the non compliant agency removed from the forwarder’s list. I know of three such occasions where this has happened.
There is another thread on here now about associations but I want to say it here also, if we were united as an industry so that we had a voice that was recognized as one of cohesion and integrity we could address these issues more effectively. Clients are concerned about who is doing their work in the field regardless if they are assigning direct or indirect. When they get the word that a forwarder is using noncompliant agencies it makes a difference. If we do this correctly and together, we can start to clean up our industry.
Uber earlier this month settled two lawsuits for $28.5M that alleged it misled customers about safety procedures and fees. Its also facing a separate lawsuit by the DA’s in San Francisco and LA who allege that Uber’s checks failed to prevent the company from hiring several felons. Then there is Kalamazoo?
The forwarders are trying to legislate themselves out of liability with the same argument as UBER by claiming they are simply a database company that connects other companies.
That is partially true because other than that they really do not do anything and are not needed. Regulation and licensing in each state should force them out of business.
In Florida the law clearly says the repo company must contract directly with the lien holder or it is unlawful ……. but just try to get the state to actually enforce their laws on anybody except the repo company trying to be honest….. after 20 years I have given up on the State of Florida and have very little respect for their licensing at this point.
Joe forgot to mention that lenders who use forwarders are still liable for the recovery companies the forwarders hire. After over forty years in this industry, I cant believe my eyes when I see what some companies hire for recovery agents. With what the forwarders pay, I guess that is all they can afford to hire.