In our collection practice we have found that it is becoming a commonplace occurrence for debtors to skip out of the country in order to avoid creditors.
This scenario typically can be found where you have a debtor who was born in another country and has come to the United States as an adult. When the debtor comes to the United States, he often times does not sever all ties with his homeland. He will leave family, ownership in real property and many other valuable assets behind.
The debtor will arrive in the United States and will open up a business of some sort. Often times the debtor already has family here, and they go in together on a joint venture.
The debtor will take out lines of credit for the business, execute promissory notes and buy goods on credit all with the belief that since he is now in the “land of opportunity” he can’t fail.
If the business does fail, and the debtor becomes unable to pay back all of the money he borrowed, generally one of three things will happen. First, the debtor will either borrow the money from a rich relative and get the debts paid. Or another alternative is that the debtor will file bankruptcy. Or third, and more common, the debtor will pack up and move back to his homeland.
The debtor feels that he came to the United States and did his best to make it work, but it just didn’t. Therefore, he will cut his losses and return home where he still has assets and family, and cannot be pursued by American creditors. WRONG!!!!!!
Most creditors and creditor’s attorneys share this debtor’s belief that it is impossible to pursue a debtor in another country. This is completely incorrect. With very few exception, all countries recognize an American debt and will honor a creditor’s pursuit of collection of that debt in their country.
Since foreign countries allow collection of American debts within their borders, the next major hurdle to overcome is finding a collection attorney in that country and dealing with the language barrier.
We are very pleased to report that there is a way to overcome both of these problems.
There exists in the United States an international collection law firm that has established contacts with foreign collection attorneys in almost every country.
This firm begins the process by employing investigators to locate your debtor in the foreign country if you do not already have an address for him. The next thing the firm does, is to locate a collection attorney in the foreign country that is willing to handle the case and is in the proper district in that foreign country to initiate litigation against the debtor.
The international collection law firm can also take care of translating the necessary documents for the court case in that foreign country.
Most people don’t understand the power that attorneys in foreign countries hold. The reason for this is because America has become so litigious, that lawsuits and attorneys are commonplace. In a foreign country, when a person is contacted by an attorney, it is a very big deal and it is very frightening for the debtor. Because of this, many foreign attorneys can settle the case merely by initiating contact with the debtor.
If the initial contact is not successful, and the attorney actually files a lawsuit in that country, this is a huge deal. The debtor will no longer have the luxury of ignoring the debt and almost always, will make arrangements to settle the matter.
The cost of all of this is not as great as you may think. Although it will vary from country to country, the initial cost of hiring the foreign attorney, translating the documents into a foreign language, and having the attorney make the initial contact with the debtor will range from between $500.00 to $1500.00.
The international law firm will take care of all communications with the foreign attorney and in exchange they will charge a contingency fee based upon the total amount of monies collected.
Pursuing a debtor in a foreign country is obviously not an option to be considered for every debt. There are factors to be weighed before this process should be undertaken.
As a general rule the debt should be fairly large (over $40,000.00) and you should have some reason to believe that the debtor has assets in the foreign country worth pursuing.
We have already been successful in collecting debts in Taiwan, England, Mexico and Italy. In fact, we were amazed at how simple the whole process really was.
Please feel free to contact our office for more information on this.