A few days ago the attorney general for West Virginia filed suit against Midland Funding, LLC, one of the largest debt buyers in the country. In the complaint against Midland Funding the attorney general claimed the Midland was filing lawsuits against consumers with false and unreliable mass-produced affidavits. These affidavits were often the only form of “proof" that the debt was owed by the person who was being sued.
Here in Arizona I meet and talk with people on a daily basis who have been sued by Midland Funding or one of the other debt buyers. People are often confused because they have never had any interactions with Midland let alone entered into any contracts with them. Midland Funding is a debt buyer. A company that buys old debts for pennies on the dollar – often three cents for ever dollar of debt. That means Midland Funding is paying $3.00 for every $100 worth of debt they buy. They then sue on those, hoping to get a judgment so that they can garnish your wages or your bank account.
West Virginia is not alone. The attorney general in Minnesota has also filed suit against Midland Funding. However, here in Arizona the state legislature is taking the opposite approach. Instead of bring this debt buyer under more scrutiny, there is currently proposed legislation that would make it easier for debt buyers like Midland Funding to obtain a judgment.
HB2664 proposes to change the law and provides the debt buyer a presumption that the debt they are suing on is actually owed if they the last billing statement and “electronic data." What this does is radically change the rules that govern legal proceedings and shifts the burden from the plaintiff debt buyer to you, the consumer.
You see, when a person or a company files a lawsuit, the burden is upon them to prove their case. If the plaintiff can’t prove their case, then they don’t win. What this proposed legislation does is shifts that burden and makes the defendant prove that the debt isn’t theirs – something that would be very difficult to do.
It is good to see some states are finally addressing the lawsuit abuse that many of the debt buying companies are engaged in. There is a strong group of consumer lawyers in Arizona fighting this legislation. Hopefully this legislation never becomes law.