Debtors strike back

In the history of mankind there were cases when debtors attacked creditors to avoid discharging. Sometimes it was neutralization as with the Order of Knights Templars. Nowadays debtors are less blood-thirsty but much more creative- they are preparing a powerful informative attack on banks.

From October 2008 unhealthy situation is forming on the Russian market of commercial debts.Quite credit worthy debtors decided to take advantages from the world economic crises and delay payments for creditors. Some of them moved on- they became to organize informative attacks on claimants, blaming them in corporate raiding and blackmailing.

So one of the big corporation which allowed default on its bonded debt, went to law against company which provided emission, blaming it in wrongly executed documents while preparing to issue of bonds. Herewith earlier there were not claims to the emission organizer- when money was raised. The claims appeared when the moment of returning money had come.

These sorts of unfair debtors immediately got “assistants” who are ready on the professional basis render help in order to fail debt recovery. It isn’t a question of anticollection, which is not represented in Russia pure and simple, but information attacks on the claimer, using black PR. Now in the market there are several thousand of unemployed PR- specialists who previously accompanied elections and, curious to relate, raid captures. It looks like some of them decided to “help” to debtors.

As far as I know in the end of April 2010 an information campaign dedicated to forming in public opinion stereotype that collector is raider, launches. In its basis there will be quite a modest idea that raiders began to buy corporate debts in order to under cover of collectors imitate debt recovery, but in very deed to capture the company. As a result there will be recipes how to hurl from pseudo collectors back, in particular, by the way of getting statements that recovery in fact is an act of unfriendly merger. At that statements are going to be given by experts of civic organizations, launching this project or affiliated with it persons. A debtor who got such an “independent” statement can go to journalists and complain about being attacked by evil collectors on the honest businessman.

In my opinion a rough campaign can strike to the client himself. In case of right facts selection, a recoverer can prove dishonesty of a debtor, who both bilks and recourse to abuses to crumb collection.  However, in the market there are more neat ideas how to resist to creditors but I won’t describe them due to my moral principles.

The situation became more complicated after a row of government statement towards more loyal treatment debtors by bank and composing a list of “untouched” companies. Many loan debtors perceived it as indulgence to debts returning and delivered goods paying. I got complaints from the row of banks that it had become impossible to lead negotiations with the representatives of a debtor because they behave rudely, openly declaring that they were not going to pay then, and in case if a creditor insisted he would had gotten nothing. Debtors became to threaten by controlling authorities in which they would go if a debtor asked to return debt.

In my view these actions can lead to serious disruption of Russian economy. Creditors should seriously consider about some consolidation in order to protect their legal interests. Essentially the authority has already give thought to this problem. Prime-minister Vladimir Putin on the 6-th of April 2010 underlined: “Don’t hit on bankers. You can call them “fat cats” etc, but kust think how many there are non-payments …” That’s why there is a possibility to apply to authority to set some reasonable rules of a game on the debt market in the period of crisis. The question is who will take on this job.

There was an idea to create an association of corporate collection. But this thought disappeared both because serious disagreements on the question of management and functional turned up and it was not up-to-date then. Now when the situation is changing it would be good if something like that will appear though without collection. I think that such an association can take two main functions:

1. Contact with authority with the object of upholding of creditor interests. It can both be led directly and through honorable Mass Media. Informative constituent in debt recovery in the period of crisis will be essential.

2. Consulting help and mediation in problematical and socially significant debts. Countering to information debtors’ attacks to creditors but not by the way of in veracious statements about raid captures on behalf of association (leadership can have strong temptation to abuse) but with the help of selection of correspond specialists.

Simple example of possible consulting assisting: my college had been recently addressed to recover debts from the company which got government support and considered itself to be untouched. The debtor simply didn’t pay to suppliers though he had money and as a response to all claims he offered to go to the law. My colleague resolved this problem in half an hour by preparing new claim that besides going to law he would send requests to Accounts Chamber of the Russian Federation, Prosecutor-General's Office and State Duma of the Federal Assembly of the Russian Federation in order to check proper use of allocated  to this company funds. Also in order to increase possibilities of examination it was said that information about forwarding requests would be published in the Mass Media. There were projects of requests and press-releases enclosed to the claim. As the result the debtor began to pay.

Published in the "Bank survey for business" №3/7, april 2009