Occupy Is Buying Your Debt -- and Ending It
BOSTON ( MainStreet) Since its forced eviction from the Zucotti Park in New York City at the end of 2011, Occupy Wall Street may have slipped from much of the general public's radar. Not only is the group still alive and kicking, but it has made recent headlines with the success of its ambitious program designed to help abolish some people's personal debt.
Rolling Jubilee , an initiative set up by Occupy's Strike Debt group last year, announced last month that has bought and purged nearly $15 million in other people's personal debt, mostly from medical bills.
"No one should have to go into debt or bankruptcy because they get sick," Laura Hanna, an organizer with the group, told The Guardian , noting that 62% of all personal bankruptcies list medical debts.
Some critics warned that lenders might be reluctant to sell to Strike Debt. Yet so far, that hasn't been the case.
"It hasn't been an issue at all," Mike Andrews, a writer and editor who has been involved with Strike Debt's efforts, told Business Insider . "[The lenders] are happy to get paid any amount for it, and they don't care what happens with it after it's bought."
Occupy says it has achieved its goals so far for mere pennies on the dollar, spending less than a half-million dollars for their return. The outcome so far has exceeded the group's original expectations, which was to raise $50,000 to buy $1 million in debt.
Occupy started Strike Debt as part of an effort to raise public awareness about how the debt market works.
When a bank or lender cannot successfully collect on an individual's debt whether from credit cards, loans or medical insurance it usually winds up selling it to the "secondary debt market." The companies in this market buy up the debt for basement prices, typically for somewhere around five cents on the dollar.
"Very few people know how cheaply their debts have been bought by collectors. It changes the psychology of the debtor, knowing this," Andrew Ross, professor of social and cultural analysis at New York University and author of the book Creditocracy, told The Guardian . "So when you get called up by the debt collector ... that gives you moral ammunition to have a different conversation."
Since anonymous accounts are often grouped and sold in a bundle, Rolling Jubilee buys debts randomly and without knowing the identity of the persons whose debt they are taking on until after the purchase. Once the debt is bought, the group sends letters letting the individuals know their debt has been forgiven.