Does the FDCPA apply to my situation?
November 4, 2009 by Todd Murray · Leave a Comment
It is an unfortunate and little-known fact that the Fair Debt Collection Practices Act (FDCPA) does not apply to every debt collection situation. Two requirements must be met before the FDCPA comes into play.
First, the debt that is involved must be a “consumer debt”. The FDCPA defines “consumer debt” as any debt where the money was used to buy goods or services that were “primarily for personal, family, or household purposes.” What does this mean in English? It means that business debts are not covered by the FDCPA. Only debts incurred to buy goods or services for use by you, your family, or in your house.
Second, there must be a “debt collector” involved. Under the FDCPA, “debt collector” is a term of art that means a business that collects the debts of another. This means that the original lender or creditor is not covered by the FDCPA. So if you had a Capital One credit card and the Capital One collection department is calling you, they are not required to follow the FDCPA. But if ABC collection agency is collecting on behalf of Capital One, the FDCPA applies to them. Law firms are also covered by the FDCPA if they regularly collect consumer debts. So the FDCPA definitely applies to a collection law firm, but probably doesn’t apply to a law firm that only occasionally handles consumer collection cases.
Of course, even if your situation involves a consumer debt and a debt collector, there must still be a violation of the FDCPA. This article details many of the common FDCPA violations.
If you live in Minnesota and have been harassed or abused by debt collector, feel free to contact me for a free case evaluation.
Debt collectors cannot violate one part of the FDCPA in an attempt to comply with another
October 29, 2009 by Todd Murray · Leave a Comment
The Fair Debt Collection Practices Act (FDCPA) requires that every voice message left by a debt collector tell you that the communication is from a debt collector. The FDCPA also prohibits debt collectors from telling third parties that you owe a debt. This can create a problem for debt collectors that leave voice messages. On the one hand, the debt collector must disclose that the communication is from a debt collector in the message. But on the other hand, disclosing that the communication is from a debt collector may violate the FDCPA’s prohibition of telling third parties about a debt. Debt collectors often whine about this conundrum.
The recent case of Edwards v. Niagra Credit Solutions, Inc. involved this exact scenario. The debt collector, apparently as a policy, did not disclose that the call was from a debt collector in voice messages. When it was sued under the FDCPA, the debt collector complained that if it left the required notice, it risked violating the part of the FDCPA that prohibits disclosing that a consumer owes a debt to a third party. The judge brushed aside the debt collector’s complaint of being in an impossible position by pointing out that the FDCPA “does not guarantee a debt collector the right to leave answering machine messages” and held that it is not legal to violate one part of the FDCPA in an attempt to comply with another part.
(photo: bepositivelyfit)
Can a debt collector call my parents about my debt?
September 30, 2009 by Todd Murray · Leave a Comment
Under the Fair Debt Collection Practices Act, debt collectors can only communicate with you or your attorney about your debt. There is a very narrow exception that permits debt collectors to contact third parties, such as your parents, but only to obtain location information. Location information is defined as your address and telephone number. During this conversation, the debt collector must tell your parents that they are attempting to confirm your location information, they must not tell them that you owe a debt, and are only allowed to identify the company they work for if asked. Of course, your parents have no obligation to provide your address and telephone number. Once the debt collector has your location information, there is no permissible reason under the FDCPA to contact your parents, or any third party for that matter.
It is fairly common for debt collectors to contact people’s parents about their debt. And its not just college students and recent college graduates. I’ve had clients in their 40’s and 50’s whose elderly parents were called by debt collectors. I suppose its possible that some debt collectors contact consumers’ parents by mistake. But I also think that some debt collectors call people’s parents as a collection tactic to put pressure on the consumer to pay the debt. Either way, its a violation of the FDCPA, unless it falls under the very narrow “location information” exception described above.
If you live in Minnesota and a debt collector has been calling your parents about your debt, feel free to contact me for a free case evaluation.
Florida lawsuit alleges debt collection harassment contributed to man’s death
September 21, 2009 by Todd Murray · Leave a Comment
A recently filed lawsuit in Florida alleges that debt collection harassment contributed to a man’s death. According to a Tampa news story, when Stanley McLeod had to quit his job because of a heart attack, he fell behind on his mortgage and other bills. Predictably, McLeod began receiving calls from debt collectors. According to the story, the calls were so frequent and harassing, that McLeod’s blood pressure and stress levels increased dramatically, ultimately contributing to his death. The story quotes McLeod’s wife as saying that there were 10 to 12 calls a day and that the calls upset McLeod so much that he would get very red in the face and short of breath. One of the voice messages left by the debt collector attempted to humiliate McLeod by sarcastically commenting on the emergency helicopter ride that McLeod endured after the heart attack that led to his job loss. According to the story, the message told McLeod to “[g]et your act together and make the payments on your mortgage. Why don’t you have that helicopter pick you up and bring that payment to the office.” McLeod’s wife remarked that “[t]hey humiliated him, they harassed him, and they didn’t care. You know that if things had been handled differently by this company, he may still be here.”
This this type of debt collection harassment is not only illegal under the Fair Debt Collection Practices Act (FDCPA), but it is simply inhumane. Some may argue that McLeod will never be able to prove that the debt collector’s harassment medically contributed to his death. While this may very well be true, it misses the point. No person should ever be harassed and humiliated in this manner simply because they owe a debt. Using this type of extreme harassment and abuse just to collect a few dollars is despicable.
More recordings show pattern of debt collectors making abusive calls (via Consumerist)
Debt collectors cannot lie or mislead you when collecting a debt
September 14, 2009 by Todd Murray · Leave a Comment
The Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors from lying or misleading you when collecting debts. Probably the most common false or misleading representations made by debt collectors are when they misstate the character, amount, or legal status of a debt.
Examples of misrepresenting the “character” of a debt include: (1) threatening a lawsuit when the statute of limitations has expired; (2) claiming you owe a debt you are not legally obligated to pay, such as a debt of a deceased relative; and (3) suggesting a debt is due even though it has been discharged in bankruptcy.
Examples of misrepresenting the “amount” of a debt include: (1) failing to give you credit for payments you made; and (2) adding unauthorized charges, such as interest or fees, to the balance of the debt. This prohibition would also apply to a debt that you’ve already paid in full.
Examples of misrepresenting the “legal status” of a debt include: (1) attempting to collect money on a non-existent judgment; (2) threatening immediate garnishment when judgment has not been taken; and (3) implying that a lawsuit has been filed or served.
In addition to misrepresenting the character, amount, or status of a debt, the FDCPA also specifically defines the following conduct by debt collectors as false and misleading:
- Telling you that they are an attorney when they are not
- Implying that you have committed a crime or that you will go to jail if you don’t pay the debt
- Threatening to garnish your bank account or wages if the debt collector does not intend to do so
- Implying that documents are legal process, such as a lawsuit, when they are not
- Suggesting that documents are not legal process or do not require action by you when, in fact, they do
The FDCPA does not limit its definition of false and misleading representations to the conduct described above. It forbids just about any conduct that can be construed as false or misleading. If you live in Minnesota and a debt collector has told you something you believe was false or misleading, fee free to contact me for a free FDCPA case evaluation.
(photo: Joe Penniston)
