"Debt dredger"'s debt-cancellation with IRS

[rockyspiker]

In 1998 Portfolio Recovery Associates harassed me for several months by telephone. Although I requested (in USPS-certified letters) a statement giving me details of the supposed debt, PRA would not send me one. Later I learned that was because PRA was harassing me over a debt that was years older than what the California statute of limitation allows for collection activity. It was PRA's intention to deceive me into thinking the debt was current, and to get me to send them money, even a small sum, which by California law would in fact make the 15-year old debt current again.

What I have learned subsequently is that Portfolio Recovery Associates is essentially a massive "debt dredging" operation, despite their expensive facade and their public-relations spin. The profitability they boast of comes mainly from buying decades old debts for three-cents on the dollar, and then trying (and often succeeding!) in harassing seniors and others to pay PRA. Basically PRA is a scofflaw outfit. Consider: Why would anyone buy hundreds of thousands, maybe millions, of debts far outside the statute of limitations...unless of course the buyer intended to habitually flout fair credit and collection laws and statutes and make the old, old debts highly profitable.

Anyway, after a few months of PRA's harassment, I sent them a "cease from further harassment" USPS-certified letter. They discontinued their telephone harassment, and I thought they had crawled back into the woodwork. This year, however, I found how mistaken I was! As it developed, my debt-dredger filed a "debt cancellation" (for a fifteen year old debt, mind you) with the IRS.

In other words, PRA cannot legally harass me over this debt (although they did anyway for several months in 2008) but they can misuse the IRS and get them to harass me. I have explained this to the IRS, but they were not at helpful. Times are tough, and these "debt-cancellation" things simply represent more revenues for the government, I suppose.

It seems to me that I might have a chance a lawsuit. For one thing, this "debt cancellation" basically represents a end-run around fair collection laws for PRA. Credit and collection laws have given me no protection at all from my scofflaw debt-dredger, even though PRA is harassing me about a 15 year old debt. Further, exactly what is the cut-off point for someone buying a debt for pennies on the dollar and sending a
"debt cancellation" to the IRS. Twenty years? Fifty years? One-hundred and fifty?

If any knowledgeable forum member has suggestions on how I might fight this, please let me know. (That is, any ideas other than hiring a lawyer and paying 15 times the amount of the debt cancellation sum to fight IRS.)

Rocky

[chane]

Debt cancellation is new to me. It sounds to me like you may have a good law suit against Portfolio Recovery. You should really think about contacting a lawyer. It could be very profitable.

You may also want to report it to the FTC to see if they can get the IRS off your back. The best way to fight this is to really know the law or hire someone that does.