An article in the Cincinnati Business Courtier entitled Consumer debt? He loves it - Unifund thrives by taking on others' unpaid bills, to tune of $12 billion gives us some interesting insights into Unifund's business.
For example, the scope of their business:
Founded in 1986, Unifund is now the second-largest purchaser of U.S. consumer debt, with 2006 revenue of $375 million. And it's poised to get a lot bigger.
How much they pay for the debt they are collecting on:
Typically, [Unifund] pays no more than 10 cents on the dollar for accounts that other collection agencies have tried - and failed - to convert to cash. Then, [it] uses proprietary programs with code names like Avalanche and Iceberg to gather data on debtors. Sometimes, Unifund sues to collect. But usually it bundles accounts into salable commodities . . . . Collection agencies and law firms typically pay 20 cents to 30 cents on the dollar for Unifund accounts, transactions that let [Unifund] double or triple [its] original investment.
The article does mention Unifund's reputation:
Consumer activists like Budd Hibbs have criticized Unifund's tactics as overly aggressive. Hibbs, who bills himself as "America's Consumer Credit Expert" calls Unifund one of America's worst debt collectors at www.buddhibbs.com.
The problem not mentioned in the article is Unifund suing on debt for which it has paid almost nothing, and for which it has little to no documentation. Unifund's involvement with alleged debts can also cause problems for consumers by Unifund purchasing and then reselling the alleged debt, again with little to no documentation.
The bottom line is that consumers need to be extremely cautious if they come across an alleged debt with which Unifund is involved. If sued by Unifund, immediately consult with a consumer attorney. California residents can contact me at my firm via telephone (858-679-3396) or email (psmith@paulsmithlaw.com). for a free consultation. Residents of other states can locate an attorney through the National Association of Consumer Advocates website.
You can read what Bud Hibbs has to say about Unifund by clicking here.