This morning I saw they did an inquiry so I started looking for this company and came across all these complaints. I am looking forward to my demand letter to see what they are trying to collet.
All of you have asked about why the media hasn't been involved. I found this newspaper article with the same problem we are all going through.
This article below explains why no one has heard of chase providian.
Behrouz Saba received the letter earlier this month, and it scared the pants off him.
"Your account has been purchased by NCO Portfolio Management, an affiliate of NCO Financial Systems Inc., " the letter began. "It is important that you forward your payment."
The letter said he owes $3,059.49 on a Chase Providian credit card account. It said $4,119.92 in interest charges have been tacked on, making the total amount due $7,179.41.
One problem: Saba, 56, a small-business owner in Los Angeles, has never had a "Chase Providian" card, let alone any plastic with the account number that's listed in the letter.
Another: There's no such thing as a Chase Providian credit card.
And Saba isn't alone. A search of consumer-oriented Web sites turns up numerous other people who also say NCO has come after them in recent weeks for nonexistent Chase Providian debts.
In almost all cases, the total amount sought is in the $7,000 range. And in each case, the NCO letters threaten to report the consumer's deadbeat status to "all national credit bureaus, " thus impacting his or her credit score.
"I was flabbergasted, " Saba told me. "This is not a card I ever had. This is not an amount I have due."
NCO's letter said that if Saba didn't pay off the $7,179.41 or officially dispute the debt within 30 days, "this office will assume this debt is valid, " and the outstanding funds "will be subject to further collection."
First off, NCO is no fly-by-night operation. The publicly traded Philadelphia company says it's "ranked among the top 10 debt purchasers" nationwide. It pocketed net income of $52 million last year, up about 22 percent from a year before.
According to San Francisco's Providian Financial, Saba applied for and received a Providian-issued Visa card in 1987. There are no records of what became of that account.
What is known, however, is that due to a business setback, Saba filed for Chapter 7 bankruptcy protection in early 1992. He says the filing was approved by a Bankruptcy Court in May of that year, thus wiping out all existing debt.
"When his account was discharged, he no longer owed anything on that card, " Providian spokesman Alan Elias said of Saba's pre-bankruptcy Visa obligations.
He said there's no record of Saba ever opening another account with Providian.
In Providian sold its $8.2 billion credit card portfolio to J.P. Morgan Chase. At that point, Providian says, Saba's account (or the post - bankruptcy bookkeeping notation that remained) was handed over to Chase — as were the accounts of about 3.3 million other consumers.
Now we know what NCO means by a "Chase Providian" account.
Chase, in turn, reportedly sold an unspecified number of non-performing accounts — so-called junk debt — to NCO a few months ago.
A Chase spokeswoman said she was unable to discuss details of Saba's case or the transaction with NCO.
Typically, however, a collection firm will pay pennies on the dollar for junk-debt accounts, hoping that any money recovered will represent profit.
NCO's letters to people with previously resolved "Chase Providian" debts may be nothing more than an honest mistake.
But credit card industry insiders and bankruptcy lawyers tell me another possibility is that NCO is unable to tell from its records which accounts purchased from Chase are still valid debts and which were covered by bankruptcy proceedings.
These experts suspect what's really happening is that NCO is contacting all former account holders regardless of their true debt status and placing the burden on consumers to prove that they're not deadbeats.
Lawrence Szabo, an Oakland bankruptcy attorney, said he's received calls in recent weeks from a handful of former clients who've received letters from NCO.
"NCO is the worst, " he said. "They could easily run a check on each person before they send out a letter, but they don't bother. They just send out the letters and hope that at least a small percentage will pay some money."
More often than not, Szabo said, consumers don't know that it's against the law to try to collect old debts from people who have received bankruptcy protection.
As a result, many people get bogged down in lengthy negotiations with a debt collector. Or they cough up some cash to make the problem go away.
"Basically, this is just an attempt to strong-arm something out of people, " said Thomas Burns, a San Francisco bankruptcy lawyer.
I made repeated attempts to contact NCO. I finally got through to Lisa Hagee, vice president of marketing.
"NCO's policy is not to provide comments to the press, " she said. "If we have something to say, we issue a press release."
On May 12, the company issued a press release announcing it would pay a fine of $1.5 million to settle charges by the Federal Trade Commission that NCO had violated the Fair Credit Reporting Act.
The FTC's press release on the matter said this was the largest-ever civil penalty related to the Fair Credit Reporting Act. It said NCO had reported "inaccurate information about consumer accounts to credit bureaus, " which could have wrongly lowered people's credit scores.
For its part, NCO's press release insisted that the company "steadfastly denies all allegations." It said NCO agreed to pay the $1.5 million fine "to avoid protracted and expensive litigation."
So what should Saba and others in his position do? It's a hassle, but they should probably jump through NCO's hoops and dispute the company's debt claims.
"They shouldn't have to, " said Szabo, the Oakland bankruptcy attorney. "This is something NCO should have checked in the first place."
But that would make the debt-purchasing game a good deal less lucrative, wouldn't it?
David Lazarus' column appears Wednesdays, Fridays and Sundays. He also can be seen regularly on KTVU's "Mornings on 2." Send tips or feedback to [email protected].
Http://www.sfgate.com/cgi-bin/article. Cgi? F=/c/a/08/19/BUG88E9R9M1. DTL
Jason
Phoenix, Arizona
U.S.A.
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