03/19/2013 11:21 am ET Updated May 19, 2013

When the Private Sector Goes Bad: Preying on Troops and Veterans

With President Reagan's election, the majority of the American people embraced an economic and political philosophy enshrining the private sector as the driver of US life and values. The results are in. Look around. US physical and social infrastructure is crumbling and falling behind other industrialized nations. In a previous article, I stressed that it is time to begin rebuilding the nation and abandon Reagan's failed view, still nurtured by a minority.

While the US economy is stuck in a quagmire of low wages, concentrated wealth and corporate welfare, congressional action guarantees a slow recovery at best. This Great Recession recovery did create one boom industry, debt collection. Where once the least among us were the sole victims of unscrupulous lenders and bill collectors, now every segment of society is subject to the worst of this lot.

Frequently, veterans, active duty members and their families complained about unjustified foreclosures and unscrupulous debt collectors. Some lucky ones were helped but too often little was done. Several recent stories and incidents cause me to move from outrage to drastic action.
  1. According to the New York Federal Reserve, education loan debt has nearly tripled in the past eight years. The Republican Party, serving financial industry interests, compounds this grim statistic by making student loan forgiveness nearly impossible. Apparently, there is no effective statute of limitations for murder, treason and now, student loans. Huffington Post's Tyler Kingkade wrote:
  2. "...In 2005, congressional Republicans pushed through a new law that made private student loans nearly impossible to discharge in bankruptcy. While student debt tops all other forms of consumer debt, it's the only kind that cannot be absolved in bankruptcy..."

  3. 'Too big to fail' financial institutions operated under the mistaken conservative government belief that the private sector could best regulate itself. The result was the mortgage crisis which was the catalyst for the Great Recession and plunged thousands of hard working, responsible Americans into foreclosure.
  4. A combination of mistakes, greed and outright illegalities, plunged innocent citizens into a financial hell. Many of those people were active duty military and veterans. Laws were blandly broken and failed to protect those serving our nation in harm's way.
Media stories on debt and foreclosures often skip over the horrible personal catastrophe imposed on citizens. Even if a debt is legitimate, an American sense of fairness and playing by the rules is often ignored. Many bill collectors violate, not just that sense of fairness, but the law.

The 'too big to fail' US banks admit they wrongfully foreclosed on military and veteran homeowners. To an extent, these institutions are reined in by both the legal system and a concern for their brand. Now imagine the bottom feeders of the industry, those supporting the payday loan companies and other fly by night companies we find outside so many military bases.

We recently had Craig Kimmel, Esquire, cofounder, law offices of Kimmel & Silverman on What Vets Need to Know. We learned a significant segment of the debt collection industry fails to comply with laws, regulations and just plain common decency. One such case, represented by Kimmel's law firm, was even featured in the New Jersey Star Ledger some weeks ago speaking to the extraordinary lengths some collectors will go to get money from American servicemen.

In the article, "Bamboozled" columnist Karin Price Mueller provides a classic example of what can happen. Frank Stack, a Vietnam War veteran, was being contacted at all hours at his home and work. And keep in mind, that work happens to be at a military installation.

"I said, 'Don't call this number again.' That was my work number," said Stack, a Vietnam veteran who at the time of the collections calls was working as a ground security coordinator for U.S. Customs and Border Protection at McGuire Air Force Base. "But they kept calling. Then they called my house. I told them they had made a mistake."

Concerned about maintaining his security clearances, Mr. Stack fought back; he obtained a lawyer. The calls stopped and action against the collection agency was pursued at no cost. According to the article, Frank Stack demonstrated that the debt was paid, but even if the debt was legitimate there are laws protecting individual rights.

Congress appears to have several members enamored with financial institutions, demonstrated by road blocks placed upon every effort to guarantee basic fairness for citizens when dealing with the industry. Perhaps now that people unjustly or unfairly harassed are taking aggressive legal action, some of these practices will be abandoned, but until lawmakers make it unacceptable to mistreat consumers, the chances are slim.

Before meeting Attorney Kimmel, we were unaware that consumers can get free legal assistance to seek redress when fairness and justice are otherwise nowhere to be found. Under the Fair Debt Collection Practices Act (FDCPA) debt collectors who violate a consumer's rights are penalized up to $1,000 per violation, and are required to pay any and all attorneys fees and costs incurred on behalf of the consumer. All citizens who are similarly treated and abused by debt collectors, should flex their muscle, get free legal assistance and fight back.

Many veterans refrain from 'causing trouble' believing that the time to fight was when they served. However, we urge fighting for justice and fairness as being part of our continuing oath to protect our country from insidious attacks against citizens. Seek recourse under the law. It is past time to stop the unscrupulous and uncivil debt collector.