Texas has given debt collectors an edge in court. So they can protect consumers instead.

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Bank officials didn’t believe Deakon Keener when he promptly reported the bizarre charges on his credit card. They also didn’t believe Mary Keener after she proved the companies who brought the charges were fraudulent.

Instead, like so many great institutions, Bank of America went into full Kafka mode. The Keeners wandered through a customer service phone maze where every attempt to fix the matter hit a dead end and a representative swore they could not be of service.

However, Bank of America’s debt collectors acted with ruthless efficiency. They tagged Keener’s credit reports and sent a processor server to file a lawsuit at lunchtime. The nightmare lasted more than a year until Chronicle reporter Yamil Berard contacted a bank spokesman.

“The bank credited Mr. Keener’s accounts and corrected the credit bureaus,” spokesman Bill Halldin wrote in an email a few days after Berard requested an interview.

I’ve experienced this dozens of times in my 29-year career. Banks, insurance companies, hospitals, schools and governments only wake up when a reporter calls. The threat of public ridicule animates faceless bureaucracies, but only one case at a time.

Americans shouldn’t rely on reporters to resolve these disputes. There aren’t enough of us.

Debt resolution shouldn’t be like this, and it doesn’t have to be.

After debt prison was abolished, civil justice took over the dispute over who owed whom how much money. Courts or the threat of a lawsuit are intended to encourage both sides to reach a mutually beneficial settlement before litigation ruins lives and finances.

But Berard’s “Loads of Debt” series proves how Texas lawmakers have skewed the court system in favor of large institutions. Banks, lenders, insurance companies and hospitals no longer need to spend money on customer service representatives or empower them to solve problems.

New laws make it cheaper and easier for companies to win judgments in an overburdened legal system. The legislature’s greatest gift to American corporations was to give debt collectors expanded permission to file suits in the magistrates’ courts.

Most justices of the peace don’t have law degrees and just undergraduate a two-week training session. When a low-income person with no attorney goes up against an experienced collections attorney in front of a minimally trained JP, guess who wins? JP collections are up 150 percent.

Overall, Texas debt collections increased 73 percent from 2012 to 2021, according to Berard’s analysis. Nearly half of all civil lawsuits filed in Texas last year — more than 374,000 — were to collect unpaid debts and clogged up files where judges neglect justice.

Many of these disputes, like those of the Keener, are ambiguous. Identity theft remains a massive problem, and some credit card issuers are cutting rather than investigating. Much medical debt arises from legally questionable overbills, and payday loan companies are rampant in Texas, granting predatory loans that are illegal in most states.

Even Nathan Hecht, Chief Justice of the Texas Supreme Court, concedes the system needs fixing. But perhaps the better question is how to stop debt collectors from going to court in the first place.

Just Louisiana has a higher percentage of the population that defaults on their debtwhich begs the question: why do 41 percent of Texans fall behind?

Half of them owe money on medical bills. Texas has the highest percentage of uninsured, and 48 percent of Texans say they find it difficult to afford health care, according to a new Episcopal Health Foundation poll. If Texas expanded Medicaid to cover the working poor, the bills would be much lower and almost half of this problem would go away.

Lawmakers could also raise the bar for filing lawsuits. The non-partisan Aspen Institute has some ideas:

Require collection agencies to document the debt, prove their claim, and determine that the debt is legally collectible when they file suit, not later in the court proceeding.

Call on the courts to educate the accused of their rights and provide them with the tools they need to defend themselves.

Require judges and judges to follow a set procedure before issuing a default or summary judgment.

Limit interest rates on past-due debt.

Debt collection companies go to court because they see a financial advantage. By protecting consumer rights, Texas can encourage institutions to close a fair deal on customer service, which would allow the court to consider more serious cases.

Tomlinson writes commentary on business, economics and politics.

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