Say someone forges a capital one credit card contract, says they bought the debt from Capone and sues.

Will the court just assume the debt is real? Are they seriously going to call Capone and ask? Does capital one have any compliance making sure it only deals with legitimate agencies? And isnt that irrelevant because the agencies can trade the debt?

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    The court doesn't "assume" anything. They will look at evidence presented by both sides and decide, based on the preponderance of that evidence, whether the debt exists and needs to be paid. I don't really understand the rest of your question; you seem to be bringing in a lot of unrelated issues. – Nate Eldredge Jul 13 at 3:02
  • Debt records for debt purchasers can be surprisingly flimsy, a lot of collection companies buy what amounts to an Excel spreadsheet with the debt amount and some personal information on the debtor. – Ron Beyer Jul 13 at 3:03
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    Oh, is "Capone" an abbreviation for Capital One or the name of the famous gangster and tax evader? – Nate Eldredge Jul 13 at 3:05

The creditor must prove the debt with evidence

In order to collect a debt, either:

  • the debtor has to agree the debt is owed - straight up or after some sort of non-binding ADR, like mediation.

  • the debtor has to prove the debt in a binding forum - either a court or binding arbitration

Details vary by jurisdiction but a court case:

  • starts with a statement of claim where the plaintiff (debtor) sets out their case against the defendant (creditor)
  • the defendant can:
    • ignore the claim - in which case the plaintiff seeks a default judgement and, providing they have a prima facie case, they will get it. They can then recover the debt.
    • admit the claim and pay the debt
    • raise a defence - in which they set out why the don’t owe the money in part or in whole.
  • each side provides evidence to support their position
  • the court considers the evidence and arguments and decides if the plaintiff has proved their case on the balance of probabilities
    • if they have, they receive judgement which the can enforce (subject to appeals)
    • if they haven’t there is no debt (subject to appeals)
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  • What's the defense if the debt is just totally made up? How do I prove a negative? – Anthony Dwayne Chapelle Jul 14 at 1:36
  • @AnthonyDwayneChapelle You’re the defendant - you don’t have to prove anything. The plaintiff has to prove you incurred the debt, how you would go about discrediting their evidence depends on what it is - if it’s a bill for, say, electricity, you might produce your bank statements showing you paid another utility at that time for electricity etc. – Dale M Jul 14 at 2:33
  • If you want to put forward a concrete hypothetical as another question, the community can answer that. Questions that are basically, “how do I defend against an ill-defined in unspecified attack?” Can only be answered “it depends on what’s not defined or specified”. Cases are all the same while simultaneously being all different – Dale M Jul 14 at 2:35
  • That doesnt seem relevant. If someone just makes a fake debt contract how do I disprove it? How do I prove a negative? – Anthony Dwayne Chapelle Jul 14 at 2:36
  • @AnthonyDwayneChapelle You owe me $100. Pay up. You’re not going to? Let me look at the evidence I have to prove it. Can’t seem to find any. Guess I better not take you to court because I’ll lose. – Dale M Jul 14 at 7:25

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