Talk About Old Debt: German Town Reveals 450 Year-old Receivable
There are plenty of ARM companies that specialize in older debt. But has anyone ever tackled a 450-year old one?
An official of the town of Mittenwalde, on the outskirts of Berlin, Germany, claims that the small enclave is owed money from the city of Berlin for a loan it made to the German capital in 1562.
According to Radio Berlin Brandenburg (RBB), Mittenwalde’s town historian says that a document has been uncovered that reveals a loan of 400 guilders payable to the town from Berlin. The loan, made on May 28, 1562, carried an annual interest rate of six percent. RBB’s analysis showed that the debt would be worth roughly $136 million today, given the interest and conversion value of the defunct guilder (a gold coin commonly used in Europe in the 13th and 14th centuries).
But with compounded interest and adjusted for inflation, the debt could be worth trillions.
A Reuters article on the matter claims that the debt is not a new find. Town officials have been dunning Berlin over the debt since at least 1820, and in 1893, the document itself was examined for authenticity.
How would you approach this debt if Mittenwalde engaged your collection agency? I guess this would fall to a municipal debt specialist.
Continuing the Discussion