According to the Wall Street Journal, sometime this year Bank of America will be slapped with punitive damages in a collection dispute. What is interesting is that the collector in question isn’t an employee of Bank of America, but instead West Asset Management, a firm who purchased the delinquent debt from Bank of America.
West Asset Management has been sued for harassing and using “psychological warfare” to collect a credit card debt from a widow, owed by her deceased husband.
If the verdict comes down as expected this opens up a legal Pandora’s box for banks, who will become exposed to massive punitive damages on the heels of the thousands of annual lawsuits for debt collector abuse and misdeeds.
This could be the wake up call banks need to insist that the firms they sell their delinquent debt to, operate in an ethical, or if that’s too much, at minimum, a legal manner.