Bill collectors are taking advantage of the confusion surrounding last year’s bankruptcy bill by telling consumers that bankruptcy isn’t available any more. I’ve heard variations from clients who’ve been told that you can no longer discharge medical debt or credit card debt in bankruptcy.

Other bankruptcy attorneys report collectors claiming that they’ve “investigated” the debtor and the debtor “isn’t eligible for bankruptcy.” Others go further and claim they will “report to the appropriate authorities” the debtor if he files bankruptcy.

Balderdash! Bankruptcy remains available to virtually all consumers. It’s more expensive and more paper intensive, but it’s there, and it works.

Collectors rely on creating an atmosphere of fear, shame, helplessness to get their targets to write a check. They count on their ability to convince the debtor that he has no legal options. Not only are they wrong in this case, they’ve violated the Fair Debt Collection Practices Act as well.

Cathy Moran