A recent Washington Post story highlights a growing problem, which the story calls debt "tagging". Debt tagging happens when a collection agency tries to collect from someone that doesn't owe the money. In some cases, it appears to be an honest mistake. For example, the collectors may accidentally pursue someone with the same name as the person who owes the money. In other cases, it appears to be intentional. The article tells the story of a Rhode Island woman who was pressured to give her social security number to a debt collector. Shortly after, she received a bill for $4,197 from a electric company for a home in Connecticut. The woman never lived in Connecticut. Only after many calls were made on the woman's behalf, did the collection agency stop.

And even when it's an honest mistake, the innocent consumer can have a very difficult getting the collector to stop. The main problem is the lack of information passed from collector to collector. It's well know that many debts are sold, often several times. As the debt bounces from collector to collector, very little information is passed along. So a consumer being pursued for a debt that she doesn't owe has a difficult time getting the debt collector to acknowledge its mistake because there's often no way for the collector to verify the consumer's story. And debt collectors are trained to assume the consumer owes the money unless they can prove otherwise.

The story advises that people being pursued for debts they don't owe should send a certified letter to the collector explaining why they don't owe the money. If the collection calls continue, the consumer should consult a lawyer.

'Debt tagging' by collection agencies a growing problem | The Washington Post | August 8, 2010