The ultimate solutions here are not judicial, but legislative[/b]! While suing their a$$es off in Court does redress some wrongs, it will take legislation to remove the incentive that causes our problems to begin with! That takes a very long time in most cases, unfortunately.
What hurts us now in terms of statute law, and what should be done about them? This is the crux of my argument here, and, shall we begin?:
First off, there are several things things in current law that hurt us in respect to the JDB: One is the lack of a uniform national standard in terms of both SOLC and the "statutes of repose"; the latter which, often, do not exist in a particular State. We would need both of these, again on a nationwide basis, to make the JDB business far less profitable, by removing any legal market value for "OOS" ("out-of-statute") debt portfolios. The uniform SOLC would make it clear to everyone when the collectibility in the courts has passed, and therefore the portfolio has little value, even as the high risk investment it aready is. Add a nationwide "statute of repose" for these debts, and the value of the portfolio disappears upon SOLC, since the debts would be extinguished (legally non-existent)!
As for the JDB chasing down debts discharged either by cancellation or BK? That needs to be made illegal on its face. It shouldn't take an Adversarial Action (in BK Court), or a lawsuit (for other discharges/cancellations) to make those debts worthless. Nor should the alleged debtor have to face dunning by more than one entity for the same debt! Nor--and this may surprise you to hear this, coming from me--should the JDB end up in legal "hot water" because they must ultimately rely on trust to "vet" the title on their purchased portfolios. A trust that, when it must be given to others of their own kind, is an extreme business risk, more than necessary, and one that is currently virtually uninsurable against loss.
The solution to title problems? Just have the law require a clear chain of title on all debt portfolios, current and charged-off/written-off/cancelled alike. This is done with real estate and motor vehicles, so why not debt portfolios? (Just try to sell real estate or your car without provable title!) Not only would the alleged debtors benefit, but so would the title insurance industry. Wouldn't title insurers love the new business? And, in fact, the JDB would benefit too. How? Requiring a clear chain of title would help insure against the "ripping-off" of JDBs by OTHER JDBs by establishing the chain of ownership! And, providing an additional means of recourse--title insurance claims--if this "rip-off" happens anyway.
Yes, there would still be JDBs, short of the entire industry being made illegal. (And, the chances of that happening would be the same as a New England winter Nor'easter occurring on the face of the Sun!) After all, many portfolios consist of "in-SOL" debts only. How to deal with problems in the case of the "in-SOL" JDB portfolio and its collection? Legally requiring clear title will help. So will re-writing the FDCPA to encompass the industry, making it perfectly clear that a JDB IS a CA, period! And, increasing the penalties for violation to a realistic level, as well as be made to be per violation. These moves will, over time, force the "bad actors" in the collection industry to reform or perish, by removing the profit motive behind the commission of violations in the first place. This would be especially true of JDBs, who collect on such a tiny percentage of portfolios to begin with. Though the purchase price is low, if they keep "acting up" under such changes, any profit they do get will be eaten up faster than the week's grocery stock by a household full of teenage boys!
No profit=JDB out of business!!