Dear readers,
This week, we published a months-long investigation by Julia Rock and Sam Mellins on the thousands of New Yorkers each year who are never told they’re being sued for credit card debt.
We asked Julia to answer a few questions about the story.
Akash: Explain it to me like I’m five. What is “sewer service,” and what did you and Sam find out about it?
Julia: If you’re being sued, you have the right to know about it. Otherwise, you’d have no chance of defending yourself.
But our investigation found that a startling number of people are never told they’re being sued for credit card debt until after a judge has already ruled against them. In New York City alone, from 2019 to 2023, defendants responded to just 17% of the 366,000 consumer credit lawsuits filed.
Why? Often because the ‘process server’ that credit card companies or their lawyers hired to deliver court papers never actually delivers them. This is what’s called ‘sewer service’ — and even when regulators catch servers doing it, they’re often allowed to keep working.
You put months of work into this investigation. Walk us through what it took to pull it off.
This issue affects hundreds of thousands of New Yorkers. To understand its scale, we spoke with consumer attorneys across all five boroughs who see these cases regularly. We obtained and analyzed court data, reviewed federal lawsuits filed against process servers, and looked at affidavits in civil court cases — some of which were clearly inaccurate. In one case, for example, a defendant was on an airplane when the server claimed to have handed him court papers.
What would it take to fix this problem?
One model comes from housing court. Under Mayor Michael Bloomberg, the city began randomly auditing process servers there to catch false service claims. Many experts we spoke to said civil court should adopt a similar system.
Judges also have the power to investigate improper service. If a defendant says they weren’t served properly, a judge can order a hearing — but that rarely happens. Consumer attorneys want them to use that power more aggressively.
There’s also a bigger picture. Some attorneys described sewer service as one part of a bigger system of predatory consumer finance. If we had fewer folks defaulting on their credit cards in the first place, and if we made it harder for third parties to buy that debt on the cheap and then sue people to collect it, we’d see fewer of these lawsuits in the first place.
Related: 5 Key Takeaways From Our Investigation Into ‘Sewer Service’