2. FDCPA – Fair Debt Collections Practices Act
• What it is: A Federal law that limits the behavior and actions of
debt collectors who are attempting to collect the debt for
another
• Why: To eliminate abusive, deceptive, unfair debt collection
practices
• When: Effective 1977
• Who it applies to: Any person who regularly collects, or attempts
to collect, consumer debts for another person or institution
• Who doesn’t this apply to: Original creditors
3. FDCPA – Communicating w/ Consumers
• Consumer: Borrower, borrowers spouse, parent (if borrower is a minor),
guardian, executor, or administrator
• When: May not communicate w/ a consumer at any unusual times (8am-9pm)
• Where: At any place that is inconvenient to the consumer
• POE: may not contact at employer if requested not to by consumer or has
knowledge that employer prohibits such communications
• Cease and Desist: When a consumer requests in writing that the collector
cease further communication w/ exception to:
• Notify collection effort is being stopped
• To advise of other remedy that will be pursued (Legal Letter)
4. FDCPA – 3rd Parties
• Allowed to contact 3rd parties if we are unable to locate a consumer
• Inbound/Friends & Relatives with Questions & Payments/Banks/CCCS:
• Only when given verbal or written authorization from consumer
• Outbound/References/Relatives:
• Must give name and state they are confirming or correcting information about their
location
• May not name the collection firm or agency or reveal that the consumer owes any
debt
• No 3rd party may be contacted more than once
• Contact by letter or telegram is allowed if it does not include the nature of the
collectors business
5. FDCPA – Prohibited Practices
• Harassing or Abusive Practices
• False or Misleading Representations
• Unfair Practices
6. Harassing or Abusive Practices
• Can include but is not limited to:
– Threats
– Anger
– Tone of voice
– Embarrassment
– Profanity
– Abuse
7. False or Misleading Representations
• Can include but is not limited to:
– Threating Jail time or legal action without intent
– Stating that we are a government authority
– Stating you are anything other then the original
creditor
• Never id yourself as any other entity other then
business you work for!
8. Unfair Practices
• Can be when:
– It causes or is likely to cause substantial financial injury to
consumers;
– The injury is not reasonably avoidable by consumers;
– The injury is not outweighed by countervailing benefits to
consumers or to competition.
• Examples:
– Insinuating that you are a attorney
– Threating to deposit check before authorized due date
– Threating to publish a debt
9. FDCP – Civil Liability
• Not liable if preponderance of the evidence shows that the
violation was not intentional and resulted from a bona fide
error
• State/Federal Complaints:
• Federal Trade Commission(FTC) primary enforcement agency
• Attorney General
• Bureau of Consumer Financial protection
• Actual damages
• Includes: Embarrassment, emotional distress,
humiliation, and mental anguish
• Costs and reasonable attorneys fees
• Punitive damages: individual up to $1K per violation
• Class action $1K per plaintiff up to $500K
