Beware of Unintended Consequences

As an officer of the RABF and an insurance producer for the industry, I have always had somewhat mixed feelings on the publication of violence related to the repossession industry.

On the one hand, my humanity and respect for those who serve in this industry scream for people to be aware of what happens so owners and industry employees can constantly exercise extreme caution and return to their families each day and each night.

On the other, while any injury or death involving anyone who operates a tow truck or within the confines of the definition of “transportation” related industries is horrific, publicizing and, providing analysis of information about incidents without direct knowledge of it being repossession related through platforms like CURepossession/CUCollector, Facebook pages or groups, Instagram, Linked In or as a trade group can have unintended consequences.

I’ve seen it with the Recovery Agents Benefit Fund when people have referred individuals to us for assistance that once you dive into it the injured party really was not in the repossession business, which disqualifies them from assistance and we have to turn down an injured person or grieving family desperate for help.

While trying to help individuals who want/need state governing bodies understand “just how dangerous the industry is” – an unintended consequence of that could be the elimination of self-help repossession and/or repossession laws becoming so restrictive that it becomes nearly impossible for a repossessor to do what has historically been their job.

When you dig into the nuances of this industry – no matter how long one is involved in it – we learn that it is constantly changing. We were recently provided a lenders operational guidelines and it puts responsibility on the repossessor to identify and notify the lender if/when they become aware of a debtor who “may” be classified as a “potentially” vulnerable person; which includes an identifier as someone who is under the temporary influence of a drug or chronic alcohol/drug abusers and persons with mental, emotional, physical or developmental disabilities.

This could potentially be a huge factor when looking at violence in the industry and how a repossessor is supposed to identify these individuals and respond. With marijuana laws being in flux nationwide, the opioid epidemic nationwide, and just when someone is drinking at a party or bar – that is temporary influence and greatly affects someone’s flight or fight response and their inhibitions; and at what point is a repossession agent qualified to determine if someone may have a mental, emotional or developmental disability? Physical disabilities may be easily seen, but may not impact at all someone’s ability to understand the repossession process – and if the repossessor has to be responsible for identifying these situations – when is the lender or car dealer held responsible for lending to these individuals in the first place?

Eventually someone at a state level is going to listen about the violence in the industry and agree say this (the violence) needs to stop; and the way to do it is to stop self help repossession and force lenders to go legal on every account. Or laws can become more restrictive like those in Massachusetts and Rhode Island where you cannot go a debtor’s property without their permission at the time to repossess a vehicle – where “property” includes driveways, parking spaces and even public roads if a debtor has time available on a parking meter; and where you’re supposed to get permission from the debtor, but you’re not allowed on the property to even ask according to state law. Tens of thousands, heck – hundreds of thousands of dollars flow through Massachusetts and Rhode Island annually for attorney’s who specialize in and profit from these exact cases.

Or you can go back to Louisiana where for decades a voluntary surrender form was the only way a repossession could be completed. But even then what was found is there is a difference between “Sure, come and get the car” and “Come and get the damn car”. Some lenders would hear the latter and call it a voluntary – and some still do in order to try to pay lower fees.

From the insurance side of things – insurers follow the industry and those who don’t get introduced to it quickly when approached by agents looking to place coverage – and many set the same google alerts for “repossession” that many of us do in order to stay informed. They know when it gets reported the repo volume is up, they read the “war stories” along with the informative articles and opinions offered by power groups/players and they monitor social media.

So, they see and hear all about the industry which influences their desire to write coverage. It is also why so many carriers quickly get in and get out of the industry and how they justify rates because of what they see in these forums everyday. When a repossessor tells a reporter they’ve been shot at 3 times in the past week, and that story gets picked up and promoted throughout the industry and media, carriers pay attention and it does impact insurability of the entire industry, not just the repossession company who was shot at 3 times that week.

There is a reason the repossession industry typically worked within the shadows and the more that the issues are brought to light, the harder it could become for the same people who have good intentions of bettering the industry and are trying to make it safer. But at the end of the day – very few politicians are going to step up and tell their communities, their constituents that the repossessor and bank are right to do their part to hold you – constituent accountable for your situation – for the greater good. Those politicians are going to find ways to serve that greater good and keep their constituents happy or at least blissfully aware of what they do in Chambers and voting for them so they can stay in office.

Unfortunately, this commentary doesn’t come with a solution to an ongoing problem, but with a warning of just being careful of unintended consequences.

Dana Loan

Recovery Specialist Ins. Group