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FDCPA (Fair Debt Collection Practices Act) can save you from Collection Agencies

The Fair Debt Collection Practices Act or FDCPA was propounded by the Congress to safeguard the interests of the consumers as they are often harassed by collection agencies. Debt Collection Practices constitute an important part of the Consumer Credit Protection Act. To put an end to the irregular activities of the debt collectors in United States of America, the Fair Debt Collection Practices Act is prevalent in all the states of USA.

The FDCPA is a Federal Law meant for the protection of consumers. It encompasses a set of rules governing the activities of collection agencies. The Law also defines the type of information a debt collector is entitled to collect from the debtors. Not only this, the FDCPA also lays the ground for the legal action that can be taken against the collection agencies.

What constitutes a violation of the FDCPA?

There are certain actions or events that constitute a violation of the Fair Debt Collection Practices Act and in an effort to assist you in the Collections Shield program; we wish to make sure you understand clearly what a debt collector cannot do.  We have created an easy to understand list of the specific actions, which you as the consumer should be aware of and watch for while dealing with debt collectors and collection attorneys.

Listed below are the things a debt collector cannot do:

  • Contact you before 8 AM or after 9 PM, in your time zone not theirs.

  • Call you at work AFTER you have told him/her or any representative of that company not to.

  • Speak to anyone other than you, your attorney or your spouse about the debt. This includes neighbors, relatives and co-workers.  * Exception – a collector may contact a third party only if they do not have your current phone number, address or place of employment and they can call only to request that information.  They cannot speak about the debt with them.

  • Faxing or sending your employer an “Employment Verification” form.

  • Continue to contact you after written communication from you stating you refuse to pay the debt or wish them to cease communication.

  • Threaten violence.

  • Use profanity, racial slurs or foul language.

  • Cause your phone to ring repeatedly, whether the collector speaks to you or not.

  • Call without disclosing their identity.

  • Claim to be associated with the US or any state agency. (Such as being a “police officer”.)

  • Claim to be an attorney if he/she is not.

  • State that not paying a debt will result in arrest/imprisonment.

  • State that not paying a debt will result in seizure, garnishment or attachment of property.

  • State you have committed a crime because of nonpayment of an alleged debt.

  • Threatens to or actually communicates false information to the credit reporting agencies.

  • Any communication which does not express, “This is an attempt to collect a debt… communication is from a debt collector.”

  • Use any name other than the true name of the collection agency.

  • Accept or request postdated checks for the purpose of threatening criminal prosecution.

  • Deposit or threaten to deposit a postdated check prior to the date.

  • Withdraw funds from a bank account without your permission.

  • Cause any charges to be incurred such as collect calls.

  • Take or threaten to take or disable property.

  • Communicate via postcard.

  • Use any marking on the outside of a collection letter, which indicates it is from a debt collector.

  • Fail to send a 30-day validation notice within 5 days of the initial communication.

  • Bring a lawsuit in a location other than where you live or where the contract was signed.

  • Continue collection actions before validating the debt.

  • Act in any way, which would be considered disrespectful or abusive.

  • Use any untrue, deceptive or misleading representations in order to get you to pay the alleged debt.

Debt Collection FAQs: A Guide for Consumers
If you’re behind in paying your bills, or a creditor’s records mistakenly make it appear that you are, a debt collector may be contacting you.
The Federal Trade Commission (FTC), the nation’s consumer protection agency, enforces the Fair Debt Collection Practices Act (FDCPA), which prohibits debt collectors from using abusive, unfair, or deceptive practices to collect from you.

Under the FDCPA, a debt collector is someone who regularly collects debts owed to others. This includes collection agencies, lawyers who collect debts on a regular basis, and companies that buy delinquent debts and then try to collect them.
Here are some questions and answers about your rights under the Act.

What types of debts are covered?
The Act covers personal, family, and household debts, including money you owe on a personal credit card account, an auto loan, a medical bill, and your mortgage. The FDCPA doesn’t cover debts you incurred to run a business.

Can a debt collector contact me any time or any place?
No. A debt collector may not contact you at inconvenient times or places, such as before 8 in the morning or after 9 at night, unless you agree to it. And collectors may not contact you at work if they’re told (orally or in writing) that you’re not allowed to get calls there.

How can I stop a debt collector from contacting me?
If a collector contacts you about a debt, you may want to talk to them at least once to see if you can resolve the matter – even if you don’t think you owe the debt, can’t repay it immediately, or think that the collector is contacting you by mistake. If you decide after contacting the debt collector that you don’t want the collector to contact you again, tell the collector – in writing – to stop contacting you. Here’s how to do that:

Make a copy of your letter. Send the original by certified mail, and pay for a “return receipt” so you’ll be able to document what the collector received. Once the collector receives your letter, they may not contact you again, with two exceptions: a collector can contact you to tell you there will be no further contact or to let you know that they or the creditor intend to take a specific action, like filing a lawsuit. Sending such a letter to a debt collector you owe money to does not get rid of the debt, but it should stop the contact. The creditor or the debt collector still can sue you to collect the debt.

Can a debt collector contact anyone else about my debt?
If an attorney is representing you about the debt, the debt collector must contact the attorney, rather than you. If you don’t have an attorney, a collector may contact other people – but only to find out your address, your home phone number, and where you work. Collectors usually are prohibited from contacting third parties more than once. Other than to obtain this location information about you, a debt collector generally is not permitted to discuss your debt with anyone other than you, your spouse, or your attorney.

What does the debt collector have to tell me about the debt?
Every collector must send you a written “validation notice” telling you how much money you owe within five days after they first contact you. This notice also must include the name of the creditor to whom you owe the money, and how to proceed if you don’t think you owe the money.

Can a debt collector keep contacting me if I don’t think I owe any money?
If you send the debt collector a letter stating that you don’t owe any or all of the money, or asking for verification of the debt, that collector must stop contacting you. You have to send that letter within 30 days after you receive the validation notice. But a collector can begin contacting you again if it sends you written verification of the debt, like a copy of a bill for the amount you owe.

What practices are off limits for debt collectors?

Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:

  • use threats of violence or harm;

  • publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);

  • use obscene or profane language; or

  • repeatedly use the phone to annoy someone.

False statements. Debt collectors may not lie when they are trying to collect a debt. For example, they may not:

  • falsely claim that they are attorneys or government representatives;

  • falsely claim that you have committed a crime;

  • falsely represent that they operate or work for a credit reporting company;

  • misrepresent the amount you owe;

  • indicate that papers they send you are legal forms if they aren’t; or

  • indicate that papers they send to you aren’t legal forms if they are.

Debt collectors also are prohibited from saying that:

  • you will be arrested if you don’t pay your debt;

  • they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; or

  • legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.

Debt collectors may not:

  • give false credit information about you to anyone, including a credit reporting company;

  • send you anything that looks like an official document from a court or government agency if it isn’t; or

  • use a false company name.

Unfair practices. Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:

  • try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;

  • deposit a post-dated check early;

  • take or threaten to take your property unless it can be done legally; or

  • contact you by postcard.

Can I control which debts my payments apply to?
Yes. If a debt collector is trying to collect more than one debt from you, the collector must apply any payment you make to the debt you select. Equally important, a debt collector may not apply a payment to a debt you don’t think you owe.

Can a debt collector garnish my bank account or my wages?
If you don’t pay a debt, a creditor or its debt collector generally can sue you to collect. If they win, the court will enter a judgment against you. The judgment states the amount of money you owe, and allows the creditor or collector to get a garnishment order against you, directing a third party, like your bank, to turn over funds from your account to pay the debt.

Wage garnishment happens when your employer withholds part of your compensation to pay your debts. Your wages usually can be garnished only as the result of a court order. Don’t ignore a lawsuit summons. If you do, you lose the opportunity to fight a wage garnishment.

Can federal benefits be garnished?
Many federal benefits are exempt from garnishment, including:

  • Social Security Benefits

  • Supplemental Security Income (SSI) Benefits

  • Veterans’ Benefits

  • Civil Service and Federal Retirement and Disability Benefits

  • Service Members’ Pay

  • Military Annuities and Survivors’ Benefits

  • Student Assistance

  • Railroad Retirement Benefits

  • Merchant Seamen Wages

  • Longshoremen’s and Harbor Workers’ Death and Disability Benefits

  • Foreign Service Retirement and Disability Benefits

  • Compensation for Injury, Death, or Detention of Employees of U.S. Contractors Outside the U.S.

  • Federal Emergency Management Agency Federal Disaster Assistance

But federal benefits may be garnished under certain circumstances, including to pay delinquent taxes, alimony, child support, or student loans.

Do I have any recourse if I think a debt collector has violated the law?
You have the right to sue a collector in a state or federal court within one year from the date the law was violated. If you win, the judge can require the collector to pay you for any damages you can prove you suffered because of the illegal collection practices, like lost wages and medical bills. The judge can require the debt collector to pay you up to $1,000, even if you can’t prove that you suffered actual damages. You also can be reimbursed for your attorney’s fees and court costs. A group of people also may sue a debt collector as part of a class action lawsuit and recover money for damages up to $500,000, or one percent of the collector’s net worth, whichever amount is lower. Even if a debt collector violates the FDCPA in trying to collect a debt, the debt does not go away if you owe it.

What should I do if a debt collector sues me?
If a debt collector files a lawsuit against you to collect a debt, respond to the lawsuit, either personally or through your lawyer, by the date specified in the court papers to preserve your rights.

Where do I report a debt collector for an alleged violation?
Report any problems you have with a debt collector to your state Attorney General’s office (www.naag.org) and the Federal Trade Commission (www.ftc.gov). Many states have their own debt collection laws that are different from the federal Fair Debt Collection Practices Act. Your Attorney General’s office can help you determine your rights under your state’s law.


Third Party Non-debtor’s Remedy under the FDCPA

In Dolan v. Schreiber & Assocs., P.C., 2002 U.S. Dist. LEXIS 6005 (D. Mass. Mar. 19, 2002), plaintiff husband and wife filed suit against defendant collection agency and debt collectors, alleging that defendants violated the FDCPA, 15 U.S.C.S. § 1692 in their debt collection efforts.  Defendants moved to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), or for a more definite statement.

Defendants argued that the husband failed to state a claim arguing, inter alia, he did not sign the retail installment contract, and was not contacted by any of the defendants regarding the debt.  However, defendants' alleged debt collection practices could have had consequences for the husband and he could have been harmed by those practices.  Therefore, the husband's allegations were sufficient to bring him within the FDCPA's protection.  Plaintiffs alleged five different acts or omissions by defendants, including falsely representing the identity of the original creditor.  Because the FDCPA prohibited false representations and plaintiffs contended defendants falsely represented the identity of the original creditor, count one stated a claim upon which relief could be granted.

The Dolans allege Ms. Adams, one of the Defendants, in her February 29, 2000 conversation with Mrs. Dolan, stated that Defendants would seek to place a lien on Mrs. and Mr. Dolan's property and attach their assets.  Thus, Defendants' alleged debt collection practices could have consequences for Mr. Dolan and he could be harmed by those practices.  Therefore, Court held that Mr. Dolan may be a non-debtor under the FDCPA, but the Dolans' allegations are sufficient to bring him within the FDCPA's protection.  As a result, Court denied Defendants' motion to dismiss Mr. Dolan's claims for failure to state claims upon which relief can be granted.

The FDCPA protects individuals who do not owe money but who are nonetheless harassed by a debt collector.  See Dutton v. Walhar, 809 F. Supp. 1130, 1134-35 (D. Del., 1992).  Section 1692k states that "any debt collector who fails to comply with any provision of this subchapter with respect to any person is liable to such person."  Title 15 U.S.C. 1692k (emphasis added); see also Wright v. Finance Serv. of Norwalk, Inc., 22 F.3d 647, 649, n.1 (6 Cir., 1994) ("Only a consumer has standing to sue for violations under 15 U.S.C. § 1692c. . . . Section 1692c, however, appears to be the most restrictive of the FDCPA's provisions. The other provisions are not limited to 'consumers' and thus are broader than 1692c.")  "Many courts have held that 'person' includes non-debtors who have nonetheless been harmed by an improper debt collection practice."  Flowers v. Accelerated Bureau of Collections, Inc., 1997 U.S. Dist. LEXIS 3354, 1997 WL 136313, *7 (N.D. Ill. 1997).  At a minimum, this protection extends to people with the authority to open and read the debtor's letters.  See Wright v. Finance Serv. of Norwalk, Inc., 22 F.3d 647, 650 (6 Cir., 1994); see also Riveria v. MAB Collections, Inc., 682 F. Supp. 174, 175 (W.D.N.Y., 1988) ( any person who comes in contact with proscribed debt collection practices may bring a claim under the FDCPA).  Id. at 6, 7, 8.

In Wright v. Finance Serv., 22 F.3d 647, 649 (6th Cir. Ohio 1994), Gladys Finch, who lived with her daughter, Plaintiff, Betty Wright, died in October, 1989.  Wright was appointed executrix of her mother's estate in April 1990.  After Finch's death, the defendant, Finance Service of Norwalk ("Finance Service"), a debt-collection agency, sent 14 letters addressed to Finch, each of which was an attempt to collect $112 from Finch for an allegedly overdue medical bill.  Wright, acting as executrix for Finch's estate, opened the letters.  Finance Service stopped sending the letters after Wright informed the agency that Finch had died.
                Plaintiff Betty Wright, executrix of her deceased mother's estate, contended that she may collect $ 1,000 for every violation of the FDCPA, 15 U.S.C.S. §§ 1692 to 1692o, that defendant committed in its attempt to collect $ 112 from her mother.
                Defendant asserted that plaintiff did not have standing to bring suit on the basis of the letters sent to her mother.  The trial court held that plaintiff had standing to bring suit. 
Both parties appealed. The Court of Appeal affirmed the district court's holding that Wright, as the executrix of the estate, had standing to sue Finance Service under the FDCPA.

In this case, the district court found that Finance Service violated 15 U.S.C. § 1692e, which prohibits a debt collector from using "any false, deceptive, or misleading representation in connection with the collection of any debt."  Unlike other sections of the act where relief is limited to "consumers", under § 1692e a debt collection practice need not offend the alleged debtor before there is a violation of the provisionId. at 649.

For example, only a "consumer" has standing to sue for violations under 15 U.S.C. § 1692c.  This section prohibits a debt collector from, inter alia, contacting a consumer at unusual times or places.  By definition, enforcement of violations of this section is limited to "any natural person obligated or allegedly obligated to pay any debt", 15 U.S.C. § 1692a(3), or "the consumer's spouse, parent (if the consumer is a minor), guardian, executor, or administrator", 15 U.S.C. § 1692c(d). See West v. Costen, 558 F. Supp. 564, 577 (W.D. Va. 1983).  Of course, had Finance Service violated this section of the FDCPA, there would be no question about Wright's standing to sue.  Id. fn. 1.
Section 1692c, however, appears to be the most restrictive of the FDCPA's provisions.  The other provisions are not limited to "consumers," and thus are broader than § 1692c.  See Whatley v. Universal Collection Bureau, Inc., 525 F. Supp. 1204 (N.D. Ga. 1981) (FDCPA allows any person who has been harmed by a proscribed debt collection practice under § 1692d to sue for damages under § 1692k(a)(2)(A)).  Id. fn. 1.

In this case, it was stated that the Court believes that the purpose of the FDCPA and the legislative history of the act also support this conclusion.  The FDCPA's purpose is "to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses." 15 U.S.C. § 1692(e). 

Given the broad language of the FDCPA, the purpose of the statute, and Congress's intent to make the statute self-enforcing, Court found that, at least in this case, the phrase "with respect to any person" included more than just the addressee of the offending letters.  Court concluded that the phrase, at a minimum, included those persons, such as Wright, 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.  Otherwise, a debt collector's liability would depend upon fortuities such as an alleged debtor's death.  Such a result is inconsistent with the broad scope of the FDCPA, and we decline to so limit the act.


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