Exploring the Debt Collection Industry

June 11, 2007

The Scam of Arbitration

Filed under: Arbitration Justice — budhibbs @ 4:13 pm

The Scam of Arbitration  

Debt collectors, junk debt buyers and bottom feeders are looking to enrich themselves through arbitration claims filed with the National Arbitration Forum, Minneapolis, MN. Some of the organizations filing arbitration claims include Wolpoff & Abramson, Baltimore, MD, Collect America (CACH & CACV) Denver, CO, Mann-Bracken, Atlanta, GA ,NCO Financial Systems, Baltimore, MD and Midland Credit Management.Arbitration is an area most consumers have little or no knowledge of and the system is set up to take advantage of that. The National Arbitration Forum (NAF) is biased in favor of those who file claims because their filing fee of $250/per account is what keeps them in business.To give you an idea of how this functions, let’s use our Washington bureaucracy for an illustration: NAF is the Congressional representative writing laws. Debt buyers are the lobbyists looking for favorable results on their investments.  They write a check to the NAF, the arbitration claim is filed, the NAF pays a local lawyer to rubber stamp awards in favor of the debt buyer and just like Washington, they make a ton of money, while you get screwed. Sound familiar?The attorneys they use are from your local area (with exceptions) who are also paid a fee of $250/hour with the expectation they will handle up to six claims per hour. Do the math, does this sound ethical? The arbitrators rubber stamp their approval, many lie and sign statements that are false and perjured so they can stay on the money side of the NAF.

The arbitration process conducted by the NAF is a corrupt system of big bucks designed to screw the consumer who is mostly kept in the dark about the process and how it evolves. I have seen many awards where attorneys lied in their statements just so they could collect the $250/fee. (Does this sound like a lobbying organization?)

There are ways to take on this corrupt system and turn the tables on the National Arbitration Forum and the lawyers they pay to make awards against you they may not be entitled to. A national group of consumer attorneys is fighting the arbitration system head-on.

If you are threatened with, or served an arbitration claim get in touch with me for assistance and referral to an expert who can assist you. If you fail to respond to an arbitration claim, it could eventually end up with a judgment against you, so the time to take action is when you are threatened or served.

Contact us at: budhibbs@budhibbs.com assistance



  1. Grant: http://members.aol.com/discussiondox/az/azresource.html

    Did you read the articles I referred you to up above?

    Comment by impishredhead — April 24, 2008 @ 1:42 pm

  2. Yes I got those ones.

    Thanks Red.

    Comment by Grant — April 25, 2008 @ 11:21 am

  3. Well people. Unfortunatley I lost my battle against the arbitration award. I guess there is no justice in the State of Arizona. I didnt even get a hearing or a anything if front of a judge. Somethings wrong with that I say. I guess I can attempt an appeal is all thats left. I know one thing, those bloodsuckers will never see a penny of my money. Good luck to everyone in your endeavours.

    Comment by Grant — May 1, 2008 @ 1:12 pm

  4. Grant please email me at: purplejustice@gmail.com

    Comment by impishredhead — May 1, 2008 @ 8:37 pm

  5. I was looking at one of these websites, and in one of the posts the poster said this,

    3/6/06 – I CMRRR 3 letters to the Law Firm: (1) Refusal of Arbitration letter found at http://whychat.5u.com/arbltr.html, (2) Demand Letter for $5,000 from the CA for FCRA and FDCPA violations, and (3) Demand Letter for $2,000 from the Law Firm for FDCPA and FCRA.

    What are the last two letters, a demand letter for 2000 dollars and a demand letter for 5000 dollars. Any idea.

    She ended up getting the case thrown out. Link can be found here.


    Comment by Rolando D. Cantu — May 18, 2008 @ 11:18 am

  6. Oh well guys I am about to give up my fight. I have worked to hard to get my credit back to respectable standards, and I don’t want an Arbitration hearing to ruin my credit. I got a thing in the mail from the NAF that they have given my case to an arbitrator, and they will do something less than 30 days. I have sent every letter, and everything I have read or could think of, and just no luck. I may call a lawyer tomorrow, and see how much it would be to hire one, but I am just afraid that it will ruin my credit once again, and I just can’t have it so close to getting my past troubles behind me.

    Comment by Rolando D. Cantu — May 22, 2008 @ 8:47 pm

  7. Help, I’ve done everythign I could find here against Chase Bank and Mann Bracken and the NAF. Sent CMRRR Demand for Verification letters to the Law Firm: (1) Refusal of Arbitration letter found at http://whychat.5u.com/arbltr.html, Now I just got a notice of AWARD !!! What the hell. I am freaking out. What do I need to do to get this reversed ???

    Comment by NeedHelpNow — June 13, 2008 @ 9:26 pm

  8. NeedHelpNow, unfortunately the NAF typically IGNORES the Refusal of Arbitration letter and proceeds to issue an award. They might now file in court to confirm the award into a judgment, but it’s not unusual for them to WAIT for a few weeks or months (until your state laws no longer allow you to successfully oppose confirmation of the award!) However, by sending the Refusal you have given yourself some room within which to fight confirmation of the award in court – as long as you do it within the legal timeframe according to your state law. I highly recommend reading the articles found here: http://www.cirthinktank.info/articles.html. Then consult with a NACA attorney to explore the options available under applicable state law.

    Comment by impishredhead — June 14, 2008 @ 3:27 pm

  9. County judges are on the take too if you ask me. They just rule against the defendants without a hearing in most cases I have heard. What ticks me off most is debt collectors by their illegal tactics force people into hiring lawyers who then get our hard earned money because of it. Shakespeare was right. Kill all the lawyers.

    Comment by Blusharky — June 30, 2008 @ 4:05 pm

  10. As someone involved in the county judicial system I have to say, “Thanks a lot,” Blusharky.

    Comment by impishredhead — July 1, 2008 @ 12:14 pm

  11. Hi there. I need some advice please can someone help me what to do. I just received a letter from National Arbitration Forum regarding my Chase Bank USA before that i haven’t pay completely yet. I don’t know what to do or what is my next step to do. I never receive this type of letter before and I don’t exactly understand what ARBITRATION is. Please can someone advice me. I’d really appreciate it.

    Thank you and I hope to hear from you soon.

    God bless,

    Comment by Ms. Sharon — July 14, 2008 @ 5:37 pm

  12. Ms. Sharon, please go to http://www.arbitrationjustice.com. There’s a lot of info there to get you up to speed on arbitration, as well as a forum for consumer discussion of arbitration related experiences and issues.

    Comment by impishredhead — July 15, 2008 @ 8:56 am

  13. Okay… got a slight variation for you… In 2005 I used a 3rd party debt settlement company to negotiate a settlement on my Bank One account. The first 3 payments were withdrawn from account without any problem, the final payment was submitted incorrectly to my bank and was denied as an unknown account #. At this time Chase took over B-1. We (myself and the 3rd part company) contacted and re-initiated the final payment with the same result. In dealing with Chase they refused to honor the settlement agreement and tried offering a new settlement on the balance (which had accrued major interest). While dealing with Chase I received notice from Mann Bracken on their collection effort. I supplied them will all documentation(bank documentation as well) of Bank One/Chase’s error in trying to withdraw the final payment and disputed the account with Chase as well. Next thing I received was an Arbitration notice (May 2006). I responded back to Mann Bracken with all of the documentation that backed up the settlement agreement and proved the creditors error is submitting the request for final payment. I have not heard anything from Mann Bracken since they received this packet in 2006. This past week I received a 2nd Notice of Arbitration along with their letter of offer to settle for 75% of the balance! In reviewing the paperwork, the only thing that has changed was my address (the amount of accrued interest was still the same as in 2006 and stating that interest would continue to accrue until settlement/judgement!)The rest of the form was exactly the same (the same NAF case # as well from 2 years ago!) My question is this… I feel that they are trying to bluff me with the notice, and my intention is to respond with all of the same backup as before, but do I need to go head and send this to NAF as well (as I did not the first time)? Should I contact NAF to verify the case # that is listed on the notice to see if it is actually valid? It is obvious that MB did not proceed with Arbitration process the first time, but will they this time or are they just trying to use scare tactics (since my SOL is up in 9 months) I have the response packet ready to go to MB (I feel the quicker I respond with so much documentation,the more effect it has, that way they realize I am completely on top of this issue) Any insight would be appreciated!!! Thank You!!!

    Comment by mla913 — August 4, 2008 @ 7:52 pm

  14. I need your help in understanding something. 58 days after the Meeting of Creditors, MBNA filed a complaint (Adversary Proceeding cover sheet) regarding my purchases as being fraudulent ($24,575). These purchases were made within 2 months time. There are legitamate reasons why I made those purchases within that time frame. Anyway, I found this information on PACER (info. on all court stuff). I called my lawyer and he knows nothing about it. Could this be a scam, a scare tactic? I didn’t receive any paperwork in the mail and it has been 2-3 days since MBNA electronically filed these papers via PACER. If this is a true adversary proceeding, do I have to go to court or can I resolve this via mail or phone? I hate going to court.

    Comment by Carmelina — November 25, 2008 @ 2:22 pm

  15. Say… what? It sounds like you’re dealing with a bankruptcy, not arbitration. I’m also wondering why you’re asking such a question on the internet rather than asking your lawyer. Yes, the lawyer might charge you to answer the questions but bad answers from strangers on the internet could cost you a lot more! Please ask your lawyer. If that isn’t possible for some reason, go to a consumer forum that has a bankruptcy section, like creditboards.com.

    Comment by impishredhead — November 25, 2008 @ 4:27 pm


    Comment by ROBERT — March 19, 2009 @ 2:15 pm

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