Perspective | A Legal Analysis of “Anti-Collection” Practices in Financial Loan Disputes

In recent years, as the non-performing loan rates for microloans and credit cards in the financial sector have gradually risen, a shadowy black-and-gray industry targeting this sector has begun to emerge. Entities operating within these industries often masquerade as “debt optimization” firms, charging borrowers exorbitant fees under the guise of helping them restructure debts, reduce interest payments, or otherwise ease their financial burdens. Industry insiders refer to this type of business as “anti-collection.”

As complaints and other actions intended to protect borrowers’ rights have been maliciously exploited by “anti-collection” groups, they have become a common tactic for delaying debt repayment. Specifically, the following are some of the most common methods:

First, “anti-collection” groups engage in malicious complaints and refuse to engage in any meaningful communication. When financial institutions or their third-party debt-collection agencies reach out to borrowers, these “anti-collection” groups use call forwarding to establish contact with the financial institutions themselves. They then resort to abusive language and other hostile behaviors toward collection agents, threatening them with extreme measures such as borrower suicide. They also file malicious complaints with financial regulatory authorities or use these complaints as leverage to demand that collection efforts be halted. However, these “anti-collection” groups unilaterally impose demands on collection agents while completely avoiding any discussion about how the borrower can actually repay the debt.

Second, falsifying identities and supporting documents: “Anti-collection” groups often claim to be the borrowers themselves or their relatives. Some even pretend to be the actual users of the borrowed funds, attempting to gain the trust of collection agents in this manner. Even more brazenly, they fabricate fake credit reports, medical records, and other documents, then submit unreasonable demands to collection agents—such as waiving interest, offering personalized installment plans for the principal, or using prior interest payments to offset the principal. If collection agents indicate that such repayment arrangements are not feasible, these “anti-collection” groups will revert to their first modus operandi, resorting once again to coercion against collection agents.

Third, “anti-collection” groups induce collection agents to engage in illegal collection practices. The members of these “anti-collection” groups are a mixed bunch, including many former collection agents who are intimately familiar with the industry’s basic rules. As a result, they go to great lengths to persuade collection agents to violate regulations. For example, after forging their own identities, they extract borrower information from collection agents and then threaten to disclose this information unless the agents stop collecting debts—or even use this threat as an excuse to file complaints with financial regulatory authorities and demand compensation from financial institutions.

1. Using legal services as a gimmick

Many “anti-collection” companies typically name themselves “xx Law” and include phrases such as “professional legal service personnel” in their introductions, deliberately creating confusion and leading borrowers to mistakenly believe that these companies are law firms—thus fostering a perception of legitimacy and professionalism. However, this is nothing more than a marketing gimmick used by these companies to attract customers; they have absolutely no affiliation with actual law firms.

2. High degree of consistency in scripts

The so-called “anti-collection” alliance, in its early stages before it had yet reached industrial-scale development, was essentially a group of “deadbeat debtors” who pooled their experiences of defaulting on loans and shared them for a fee. These experiences were continuously disseminated and applied, eventually giving rise to today’s “anti-collection” industry—and the shared advice is strikingly consistent. When handling a batch of financial loan cases for a certain bank, the author encountered the very same set of talking points among four to five borrowers living in the same prefecture-level city. These borrowers had no prior contact with one another; upon questioning, they revealed that it was so-called “friends” who had introduced them to this particular script. Further inquiry uncovered that these “friends” had been paid hefty fees by the other party before passing along the script. Although it remains uncertain whether the same “anti-collection” company or individual was responsible for spreading these tactics, what is certain is that this industry features standardized, pre-established templates designed specifically to handle similar situations.

3. Taking the internet as the primary platform

The “anti-collection” industry typically uses the internet as its primary battleground. When you search on search engines using keywords such as “debt optimization,” you’ll find a large number of advertisements prominently displayed at the top. The staff involved in “anti-collection” activities are highly diverse, coming from all walks of life. As a result, they often don’t have any physical office locations and conduct all their operations entirely through the internet and social media platforms.

“Anti-collection” refers specifically to actions taken in response to collection activities. Therefore, before examining the legal nature of “anti-collection,” it is necessary to first clarify the legal nature of collection activities themselves.

The gradual rise in non-performing loan rates for microloans and credit cards in the financial sector has first triggered the emergence of the debt-collection industry. From a legal perspective, debt-collection activities should be regarded as private remedies under civil law—actions taken by the creditor (i.e., the financial institution) itself or by an agent it has authorized (i.e., a debt-collection agency) to compel the debtor to fulfill its obligations. As long as collection efforts remain within the bounds permitted by law, they do not constitute illegal behavior and, in fact, represent an important component of the financial market. Under lawful and effective collection practices, such activities can facilitate economic circulation and play an indispensable economic and social role. However, excessive or abusive collection practices may amount to tortious conduct under civil law and could even violate criminal statutes, such as the crime of provoking trouble.

In contrast, the “anti-collection” practices commonly seen in the market essentially represent an abuse of “reasonable rules,” posing significant legal risks. Moreover, these risks do not affect only those engaged in “anti-collection” activities—they also extend to the borrowers themselves. By resisting repayment through various means, borrowers are not merely engaging in malicious default; rather, they are effectively attempting to write off their debts, raising suspicions of loan fraud. From an objective standpoint, borrowers have the financial capacity to pay the fees demanded by “anti-collection” agents yet deliberately refuse to repay their loans, demonstrating a clear subjective intent to unlawfully appropriate the borrowed funds. For example, in a criminal case involving credit card fraud recently adjudicated this year by the People’s Court of Datong Hui Autonomous County, Qinghai Province [Case No.: (2025) Qing0121 Xingchu No. 3], the borrower, after defaulting on credit cards issued by multiple banks, entrusted a certain credit reporting agency to handle his debt. Subsequently, he was notified by public security authorities and voluntarily turned himself in for processing. The court found him guilty of credit card fraud, while the credit reporting agency itself was subjected to criminal penalties.

The “anti-collection” practice uses false advertising to infringe upon borrowers’ personal information, defraud them of their money, and simultaneously place borrowers on the opposite side of the law. This seriously disrupts the financial regulatory order and the social integrity system, and harms the legitimate rights and interests of financial institutions.

1. The approval process is not rigorous.

Before disbursing loans to borrowers, financial institutions typically verify the borrowers’ basic information and base their lending decisions on this information. However, during this process, there is a problem of insufficient rigor in the review conducted by loan officers. Since the volume of loan disbursements is directly linked to loan officers’ performance—and thus their income—some loan officers, driven solely by the goal of meeting performance targets, have relaxed their screening standards for customers, resulting in some loans being channeled to borrowers who, in fact, have no intention of repaying their debts. Moreover, in practice, some borrowers have reported that “intermediaries” are involved in the loan-disbursement process. These intermediaries work together with loan officers to facilitate loan disbursements, and such collaboration inevitably leads to numerous instances of lax oversight. As a result, funds end up being lost, and borrowers subsequently communicate with financial institutions through “anti-collection” services.

2. Financial institutions lack room for negotiation.

In practice, there are also cases where borrowers genuinely lack the temporary ability to repay their loans. However, after proactively reaching out to financial institutions for communication, since these institutions offer no room for negotiation, the two parties fail to reach an agreement. As a result, tensions between the financial institutions and borrowers escalate, causing the borrowers to lose their willingness to repay and ultimately turn to “anti-collection” services.

1. The absence of regulatory responsibilities on the part of financial supervision and administration authorities

At present, the reason why “anti-collection activities” are labeled as a “gray and black industry” is precisely because there is currently no explicit legal provision governing this area. As a result, only in cases of serious circumstances can offenders be convicted and sentenced under criminal statutes; for less severe cases, however, there is absolutely no available legal recourse. The financial regulatory authorities have a duty to supervise and maintain financial order. Given the current absence of clear legal provisions, these authorities must fulfill their supervisory responsibilities, drawing on practical experience to expedite the issuance of relevant regulations, thereby ensuring that efforts to crack down on “anti-collection activities” are grounded in solid legal foundations.

2. The absence of regulatory responsibilities on the network supervision and management platform

As mentioned earlier, the internet is in fact the primary battleground for “anti-collection” activities and serves as the main channel through which such activities carry out information dissemination. Indeed, some “anti-collection” advertisements even prominently appear at the top of search engine results. Both platform operators and online regulatory authorities should rigorously screen and review this type of information. Given the widespread proliferation of such promotional materials today, they cannot entirely escape responsibility.

The reason why “anti-collection” services have grown into an industrial-scale phenomenon lies in the existing market demand. Thus, the most fundamental cause still stems from the borrowers themselves. Some borrowers lack sufficient common sense about financial consumption and financial law, fail to take their legitimate rights and interests seriously, and refuse to communicate directly with the financial institutions that provided them with loans. Instead, they recklessly entrust their personal information and financial security details to “anti-collection” agencies, ultimately resulting in damage to their personal rights and even potentially exposing themselves to criminal liability. Meanwhile, these “anti-collection” agencies effortlessly obtain borrowers’ money and personal information in the process.

Both financial regulatory authorities and online supervision platforms need to fulfill their respective supervisory responsibilities. However, relying solely on a single department to crack down on “anti-collection” activities is bound to fall short. Therefore, in the course of supervision and regulation, financial regulatory authorities can join forces with other departments to launch joint enforcement actions. For example, they can collaborate with local governments and, drawing on lessons learned from practical experience, push for explicit legal provisions targeting “anti-collection” behavior. They can also coordinate with public security organs to apprehend criminal gangs engaged in “anti-collection” activities, using the state’s coercive power to effectively curb such practices. Meanwhile, judicial authorities should leverage their own functions to serve as the final line of defense against “anti-collection” activities. Every case involving “anti-collection” that arises in judicial practice will serve as strong support for future efforts to combat this phenomenon.

On the one hand, financial institutions should strengthen supervision over the loan-disbursement process, clearly define customer profiles, and impose strict disciplinary measures on staff members found to be in violation of regulations. At the same time, they should crack down on unlicensed intermediaries involved in the loan-disbursement process, thereby minimizing the likelihood of borrower defaults at the root cause and reducing the non-performing loan ratio.

On the other hand, financial institutions should summarize the basic profiles of past defaulting customers and design mediation plans tailored to different levels of severity. In this process, they can engage professionals such as collection agencies and law firms, adopting an outsourcing approach to open up diversified dispute-resolution channels and achieve integrated “collection” and “mediation” services. Dialogue is the only effective means of achieving win-win outcomes for both parties. If either side resists communication and allows conflicts to escalate, both will end up suffering losses. By ensuring smooth communication channels and facilitating direct interaction between borrowers and financial institutions, we can significantly reduce the room for “anti-collection” activities and leave them with no foothold at all.

As consumers, we should cultivate a sound financial consumption mindset. In this process, financial institutions and financial regulatory authorities need to provide effective guidance, ensuring that consumers fully understand essential financial knowledge such as personal credit reports, thereby positively promoting the establishment of correct financial consumption attitudes. At the same time, by drawing on judicial cases and other relevant examples, consumers should be clearly informed about the borrower’s identity and the corresponding legal responsibilities. By holding consumers accountable in this way, we can encourage them to regulate their own behavior and achieve general preventive effects under the law.

As “anti-collection” activities become increasingly industrialized, financial institutions and financial regulatory authorities are encountering various types of “anti-collection” personnel in their daily practice. If an effective information-sharing platform could be established and a comprehensive blacklist for “anti-collection” activities put in place, the cost of identifying such individuals could be significantly reduced. At the same time, during their efforts to combat “anti-collection” activities, financial institutions and financial regulatory authorities could exchange information on effective approaches and develop more consistent, universally applicable, and actionable strategies. This would not only lower the costs of enforcement but also prevent “anti-collection” groups from taking advantage of differing handling methods in the future.