Each day in Civil Court in Brooklyn, Judge Noach Dear presides over as many as 100 credit card collection cases, a scene repeated day in and day out in courtrooms across the country.
The borrowers typically do not show up to defend themselves. Many do not know they are being sued, others are too poor or too intimidated to fight back. The result, in an estimated 95 percent of the cases, is a default judgment in favor of the bank or other debt collectors.
But as Jessica Silver-Greenberg reported recently in The Times, many of the suits rely on erroneous documents, faulty records and boilerplate testimony — a pattern that resembles in many respects the “robo signing” scandal of 2010, in which banks filed false court documents in foreclosure cases, depriving homeowners of due process that may have saved their homes.
Some credit card companies, including American Express and Citigroup, defend their procedures and insist that safeguards are in place to ensure that their court filings are accurate. But consumer advocates say that in many cases the suits involve debt that has already been discharged in separate bankruptcy proceedings or otherwise settled or collected. Where debts remain, the amounts are often inflated by excessive fees.
According to Judge Dear, in roughly 90 percent of credit card lawsuits the plaintiffs cannot even prove that a person owes the debt. Which is another way of saying that the courts are often being used as de facto debt-collection mills, allowing banks and others to seize money in violation of basic protections.