Steadily increasing profits
It appears that the debt-collecting business is likely to prove extremely profitable in the future. Profits of the largest in Europe, Sweden’s Instrum Justitia’s, have been increasing steadily by 10 percent over the past five years. With 82,000 customers and 2,600 staffers, it has operations in 21 countries. Of course these firms do not only deal with consumer credit; their activities range from valuations of housing loans to major hospitals’ failure to pay suppliers. In the US, these firms also collect state taxes. Nevertheless, there is no shortage of scandals. Three years ago, it emerged that the Japanese firm Nichiei, one of the largest of its kind, had forced people to sell body parts in order to meet debt payments. The company was set up by 13 credit giants including Citibank, Merrill Lynch, Paribas and ING. In another incident, a company in Taiwan used AIDS patients as its agents, and yet another forced a young woman into prostitution in order to pay a debt that she had signed as guarantor. No similar incidents have been reported in Europe, but allegations of blackmail and extreme threats have been mounting. More and more people are losing their jobs, and others are paying half their income in debt repayments. In Greece, debt collectors’ turnover is estimated at about 10 million euros annually. The owner of one of these firms owned by a major bank – who carries a gun in public – says that he is not interested in chasing up business owners. «Business owners have to hide their assets. I want to go after wage-earners, who have a house or a car I can expropriate,» he said.
