The Fair Debt Collection Practice Act is a very complex law. In the most basic explanation, the act prohibits debt collectors from engaging in harassing, threatening, misleading or abusive actions in order to collect a debt. You have rights – if you have been harassed by a debt collector, you may have a case and may be entitled to monetary damages. If you or somebody you know has been harassed by a debt collector, you should contact our Fair Debt Collection Act Lawyers immediately for a free consultation. Please click https://www.352law.com/contact/ to contact our Fair Debt Collection Act attorneys or call (352) 505-8900 to schedule your free consultation.
- What is a debt? Any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily used for personal, family, or household purposes, whether or not the obligation has been reduced to judgment
- What is a consumer? A person who purchases goods and services for personal use.
- What is a creditor? Those to whom the debt is owed either a person or organization.
- What is a debt collector? An entity in the business of collecting debts from others; a person who uses various methods for the purpose of collection of any debts, or who regularly collects debts owed to others.
Established in 1982, the Fair Debt Collection Practice Act was passed by Congress in response to the abusive practices of debt collectors. The purpose of the act are to eliminate abusive debt collection practices, to promote consistent state action to protect consumers against debt collections abuses, and to ensure that those collections who refrain from using abusive debt collection practice are not competitively disadvantaged. Protect your legal rights, call the law firm of Massey & Duffy at (352) 505-8900 to schedule your free consultation with an experience Fair Debt Collection Act attorney.
The Debt Collection Process
Creditors start collection efforts with series of form letters which may be “friendly” reminders then to letters requesting a phone call to discuss problems and that nonpayment is serious. If the debt remains, the contact typically graduates to phone calls or personal visits and may progress to repossession or referral to collection agency or lawyer for suit. Phone calls may serve legitimate purpose of determining why payment are late and resolving misunderstandings and disputes, but calls may be used illegally to harass consumer in attempts to collect debt from distressed consumer.
Occasionally what may happen is that at any stage of the process, creditor may write off the debt, either because the debt obviously is not collectible or because the creditor has internal rule that obligation unpaid for certain period of time will be charged off for tax purposes. Typically, the creditor may turn the account over to a lawyer or debt collector with the purpose of collecting the debt owed.
FDCPA Imposed Requirements
- Requires validation of debts (a debt collector must notify the debtor of the nature of the debt, the identity of the creditor, and must cease collection efforts until verification of the debt is completed if the consumer chooses to verify the debt).
- Requires that a debt collector’s letter disclose that any information provided by recipient will be used to collect debts. See Emanuel v. American Credit Exchange, 870 F.2d 805 (2nd Cir. 1989) (disclosure required even when letter did not request information from debtor).
- Provides a means by which a consumer can stop the attempts of a debt collector to communicate with the consumer.
Protections Under The FDCPA
Restricts contacts by debt collectors with third parties. Debt collectors may contact third parties seeking debt collection assistance only if: The debtor has given prior consent directly to the debt collector, or the debt collector has obtained a court order permitting such contact, or contact is reasonably necessary to effectuate a poet judgment judicial remedy. Debt collectors may contact third parties to acquire information about consumer’s location, but must:
- Identify self, state he/she is trying to confirm or correct location information about consumer, and only if expressly asked, identify his/her employer,
- Refrain from referring to the debt,
- Usually make only a single contact with each third party,
- Not communicate by postcard,
- Not indicate the collection nature of his/her business purpose in any written communication, and Limit communications to the consumer’s attorney, where collector knows of the attorney, unless the attorney fails to respond.
A debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with a debt. A debt collector may not use any false, deceptive, or misleading representations in connection with the collection of any debt. A debt collector may not use unfair or unconscionable means to collect any, debt.
Debt collectors may pursue legal action. A debt collector must sue consumer only in the judicial district where the consumer resides or signed the contract sued upon. Except if there is an action to enforce a security interest in real property which secures the obligation must be brought where property is located.
Remedies For Violations Under the FDCPA
Remedies are available if violation of FDCPA is deemed an unfair and deceptive act or practice in violation of the Federal Trade Commission Act. Consequently, the FTC could pursue action. Action to enforce FDCPA may be brought in any appropriate U.S. District Court without regard to amount in controversy, or in any other court of competent jurisdiction, within one year from date on which violation occurs. (FTC Commentary: 1 year limitations period applies only to private lawsuits, not those initiated by government). It is important to remember that:
- The Act also allows private cause of action for the consumer.
- Standing to sue. “Any debt collector who fails to comply with any provision … with respect to any person is liable to such person…” Act does not define terms “with respect to any person.” Wriaht v. Finance Service of Norwalk. Inc., 1993 WL 208765 (6th Cir. June 17, 1993) – terms involve more than just addressee of letters… includes persons who “stand in the shoes” of the .debtor or have the same authority as the debtor to open and read the letters of the debtor.” (i.e. executrix of debtor).
- Civil liability for failure to comply with FDCPA includes:
- Actual damages including damages for personal humiliation, embarrassment, mental anguish, or emotional distress
- Additional statutory damages allowed by the court up to $1,000 (no actual damages required)
- Attorney’s fees and court costs if the consumer prevails
In determining the amount of damages, the court shall consider, among other factors the frequency and persistence of noncompliance by the debt collector and the nature of the noncompliance. Additionally, the extent to which the noncompliance was intentional. Generally, this is a strict liability statute; however, a debt collector may not be held liable if the debt collector can show by a preponderance of evidence that the violation was unintentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error.
Contact Massey & Duffy Immediately
Our lawyers have the experience and ability required to support our clients on an expansive scope of FDCPA issues. At Massey & Duffy, we are experienced attorneys fighting for what is right. Please click here to contact our Fair Debt Collection Act attorneys or call (352) 505-8900 to schedule your free consultation.