Collection Agencies and Debt Management Firms Misappropriating the Word “Mediation”

Recently, I received an email from a legal head-hunting site entitled “ARBITRATION / MEDIATION – 3 Partners Needed.” Intrigued, I opened the email to find the following description:

#1 Negotiating Company in America.
Open 27 years – start today – flexible hours.
Unlimited work – paid weekly.
For more infomration [sic], join me on a short conference
call Monday thru Saturday at 8AM E.S.T.

The misspelled word set off warning bells immediately, as did the daily 8 am conference call, but I did some digging anyway out of curiosity. Turns out these people are “debt managers.” The debtor employs them to threaten his creditors with bankruptcy unless the creditor accepts a fraction of what the debtor actually owes.

For some reason this really annoyed me. What bothered me more was learning through a Google News Alert email that there is a collection agency in Jacksonville, Florida that goes by the name Legal Mediation Practice. A quick search on the internet shows that this company has a terrible reputation for strong-arm tactics. In fact, the post included in my Google Alert stated that the collection agent threatened the debtor with jail. What is this? 17th Century England?

These people don’t mediate anything. They are what they are and because society has a negative opinion of both groups, they like to hide behind innocent sounding names and use terms like “mediate” and “arbitrate” because they carry with them an air of respectability their businesses lack.

As a libertarian, I am loathe to advocate governmental intervention, but shouldn’t the bar in these states regulate the use of the term “legal” and “mediation”? Isn’t this a textbook case of Unfair Trade Practices? Isn’t suggesting that you can “represent[] businesses in negotiation, arbitration, mediation and out of court settlements of disputed debts” a false statement

Causing likelihood of confusion or of misunderstanding as to affiliation, connection or association with, or certification by, another; or
Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits or quantities that they do not have or that a person has a sponsorship, approval, status, affiliation or connection that he does not have;

especially in states that regulate the certification and registration of civil mediators and arbitrators?

At the very least, doesn’t suggesting that you “represent” another business in a matter involving the collection of a debt, which is a legal matter, constitute the Unauthorized Practice of Law? I do not know whether the owners of the particular debt management company that placed the advertisement are lawyers, but based on their ad, their prospective employees clearly are not.