In our last entry we began discussing the complexities and challenges of obtaining and recording the details of judgments. This follow-up entry focuses on the challenges associated with enforcing an inventory of judgments.
For the purposes of this discussion let's segment the accounts of a legal debt collection organization into three categories pre-suit, post-suit and post judgment. If you were to look at the percentage of total accounts in each category we would find a very large segment accounts in the judgment category. The reason for this is that it is not unusual for it to take years before an organization can actually collect on a judgment. Often times a judgment will sit in a non-performing state for an extended period of time while the firm searches for employment and asset information to pursue in a post judgment remedy. Further contributing to this is the tightening of new credit markets for consumers that force collection organizations to accept long payment plan arrangements and garnishment payments rather than one time settlement payments.
Typically once the details of a judgment have been entered into the firm's collection software the next steps in the process is to have an employee evaluate the attributes of each defendant associated with the judgment awarded and identify the logical next action. The evaluation that needs to take place is not particularly complex however it is time consuming and often becomes a constraint in that it impacts other processes and the overall productivity of the entire organization. While this process is time consuming for any firm in a situation where a firm is managing judgments awarded from multiple states the process can become complex leaving the opportunity for mistakes to be made and revenue opportunities to be lost or delayed.
When reviewing the judgments, a firm is usually looking to identify employment information, bank account and other asset information that would allow them to file for garnishments or liens that will result in recovering a portion or all of the outstanding balance. Additionally, firms will leverage outside data providers to help find assets and locate consumers so they can convert non-performing judgments into performing ones. This data is critical for a firm to maintain a reasonable ratio of performing v. non-performing judgments but it does introduce another manual review. Even on performing judgments once a garnishment is obtained there is the added time and complexity of managing and renewing the garnishments to avoid any interruption in payments.
By eliminating or minimizing these time consuming manual review processes and replacing them with automated processes that could be performed by their collection software the organization could reduce staffing costs in this area and boost their percentage of performing judgments and revenue generation.
Within the Cogent standard general civil litigation workflow we have included logic that allows our collection software to perform these evaluations for you. For instance, when a judgment is entered into Cogent a task is executed by the software that evaluates if there is verified POE or Asset data available on each defendant that the judgment was awarded against. When the system finds a Verified POE or Asset data, it schedules a task to generate a garnishment or lien package and routes the account to the correct team, department or attorney to prepare immediately. Similarly, when new employment or asset details are added to a debtor profile where a judgment is already in place Cogent can perform a similar evaluation and route it to someone to file for a garnishment or lien.
The function that makes this possible within Cogent are the almost one thousand different conditions that can be used in combination with each other to build business rules that are enforced by the software. These conditions can evaluate attributes about the account, the client, the debtor / defendants and much more. To further assist with automating the judgment enforcement process we have recently developed a series of interfaces with the Experian suite of collection products. Along with the ability to review and store the data results from Experian within Cogent we have also developed additional workflow conditions capable of evaluating the Trigger types that are returned in the Experian Trigger product. This combined solution assists firms with eliminating much of the data results review process that are returned from their vendor. Now instead of having to wait for someone to complete a manual review to see if new employment or other key information has been found, as soon as the results are imported into the software, Cogent can make that determination and route that account to the appropriate individual.
Incorporating automation into the judgment enforcement processes, especially when you have the right tools, is a low cost and high payoff exercise that results in increased revenue and reduced labor cost. Cogent's suite of workflow management tools along with the automation included with the Cogent Standard General Civil Litigation workflow provide the framework to apply automation to this manual operational area and the ability to quickly respond to client or court driven process changes. Based on the volume of accounts that reside in the judgment category even a modest improvement in the percentage of performing judgments can quickly add up to significant increases in revenue.
To learn more about judgment enforcement or Cogent's standard workflows please do not hesitate to contact us. As always if you have thoughts or suggestions on how to apply automation to the judgment enforcement process we invite you to share your comments and suggestions below.