All Rise, The Court of Public Opinion is Now in Session

I don’t really ask for much, so I hope you will indulge in this one favor. Consider, if you will, the following two headlines that I came across this morning:

Headline #1: Debt collectors are going after Americans’ stimulus checks—and the CARES Act allows it

This headline has appeared in some way, shape, or form hundreds of times this week as the mainstream media latch on to the fact that the Treasury Department opted not to classify the economic stimulus funds being distributed to individuals across the country in such a way to protect those funds from garnishments. Many asked the Treasury Department to do so, and, without offering an explanation, the Treasury Department chose not to. And let’s not forget that the Coronavirus Aid, Relief, and Economic Security (CARES) Act was a massive bill written and passed by Congress. If Congress had wanted to shield the stimulus funds from garnishments, it would not have been hard to include that in the legislation. Are we to assume that 535 members of Congress and their staffs along with the White House overlooked this detail?

And, anyone in the industry will tell you that pausing a garnishment is not as easy as pausing the show you’re watching on Netflix. It takes more than just saying, “Alexa, pause this garnishment.”

Headline #2: Many San Antonians Plan to Use Stimulus Checks to Pay Bills

Am I the only one who sees the irony here?

This article uses the results of a nationwide survey, conducted by a very reputable service, that revealed that 35% of those who participated in the survey said they were going to use their stimulus checks to pay their bills.

Nobody is going to dispute that we are in unprecedented times. And nobody is going to dispute that debt collectors are doing their best to adapt to these unprecedented times by continuing to be understanding, empathetic, and compassionate toward individuals who have been impacted by coronavirus. This is true because many in the industry have been tremendously impacted by coronavirus themselves. Jobs have been lost. Companies have gone under. The impact has been felt across the industry.

My objective in writing this is not to demonize the mainstream media for the way they are mis-using the phrase “debt collectors” in the context of their articles related to what may happen to an individual’s stimulus money if there is a judgment against that person. Nor is it to highlight the hypocrisy contextualized by the two articles above, which are fairly emblematic of what is being written in newspapers and on websites across the country these days. Although that is pretty funny.

I would love to make some grand gesture, a call-to-action for everyone in the industry to stand up and try to set the record straight, especially as more and more organizations in the industry stand up and announce they do not want to see stimulus funds seized through existing garnishments. But let’s face it. It’s unlikely that any such action will move the needle in the mainstream media.

A long time ago, I covered the subprime mortgage market. And I can remember asking an executive — at a really big bank — why the industry did not stand up and talk about how subprime lenders gave people who might not get a second look from a traditional bank a chance to buy a home. And, nearly 20 years later, I still remember his response. “I’m not going to stick my head out just for it to get shot at.”

Debt collectors are not going to win this fight in the press. This fight is going to be won by the choices they make. In a week or two, if we see a string of articles sharing the stories of individuals who had their stimulus funds seized because of garnishments — similar to this article sharing the stories of individuals who had their stimulus checks used to cover overdrawn bank accounts — then the court of public opinion will be in session.

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