Michael A. Cibik, Esq. writes a regular column titled “Understanding Bankruptcy” that appears in the Philly Record. This is that column.
QUESTION: After filing for bankruptcy, should I be concerned about debt collectors who call and threaten arrest?
Folks frequently come in to talk about bankruptcy and are very concerned that an arrest warrant may be issued as they haven’t paid their debts – either before filing bankruptcy or even after filing for bankruptcy. They have heard about phone calls or emails from debt collectors (or have even gotten those kinds of threats) where the debt collector threatens immediate arrest for non-payment of a debt. This debt is usually an old payday loan or small debt that the debtor may have long forgotten. These phone calls are intimidating and threatening. However, an arrest is unlikely in most circumstances.
The Bankruptcy Code provides for an automatic stay under 11 USC 362 which forbids the collection or the attempt to collect a debt. There are very few exceptions to this automatic stay (priority debt such family support or recent taxes are usually excepted.) Most debts are covered by the stay and the debtor is protected from such collection attempts. However, these debt collectors don’t care about the automatic stay-they just want their money and will use any tactic that may possibly work. And fear usually works.
Because these debt collectors violate federal laws, the bankruptcy law doesn’t scare them. Each week, I get reports from my bankruptcy clients of heavily accented debt collectors threatening them for non-payment of debts. If you get one of these calls or emails, report it to your bankruptcy attorney so that the attorney can attempt to locate the company in order to either file a lawsuit or threaten a lawsuit if the behavior doesn’t stop.
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