FDCPA Violations (Fair Debt Collection Practices Act)
It’s one thing to call someone to remind them of a missed payment.
In reality, debt collectors are ruthless. This is precisely why Congress enacted the Fair Debt Collection Practices Act in 1978. It was in direct response to a spike in bankruptcy filings tied to evidence of abusive, unfair and deceptive collection practices.
Miami consumer rights attorneys at Jacobs Keeley know even as federal regulators turn a keener eye to the issue in the wake of the housing crisis, Great Recession and social movements like “Occupy Wall Street,” violations still happen all the time.
In general, the FDCPA governs collectors’ actions in so far as it concerns:
- Acquisition of the Debtor’s Location
- Communication with Consumers
- Disrespect of Consumers
- Misrepresentation and Unfair Practices
- Validation of Debts
In addition to federal protections, the Florida Legislature has passed supplement protections in the form of the Florida Consumer Collection Practices Act, which extends the regulations to creditors as well as debt collectors. The Florida law lays forth specific guidelines pertaining to how creditors and debt collectors are allowed to pursue unpaid debt.Debt Collection Abuses: Know Your Rights
The laws are in place for a reason, and it’s important for consumers to become educated on the rights to which they may be availed.
Understand first that debt collection agencies are hired on a commission basis by credit card companies or banks to collect past-due debts. Collectors may have outright purchased the bad credit or loan debt from the original creditor for pennies on the dollar. Despite the deeply discounted rate, these companies will aggressively press for collection of the full outstanding debt.
At first contact, a debt collector must inform the debtor of the right to dispute the debt. This is sometimes called a “mini-Miranda,” in reference to the “Miranda Rights” law enforcement officers have to give post-arrest to criminal suspects. In a debt collection action, the disclosure has to include:
- The amount of the alleged debt;
- The name of the creditor;
- The fact the debt will be considered valid if you don’t dispute it within 30 days;
- You have the right to request verification of that debt.
This information has to be given either over the phone during the first contact, or sent in writing within five days of that first contact.
When a person disputes an alleged debt, he or she has to do so in writing and the filing must be timely – within a month of that first contact. Once the collection agency receives that request, all letters and phone calls must cease until the agency has verified the debt. If verification can’t be made, collection on the account must cease.
This is a key step because debts are often sold numerous times before the collection agency calling you has purchased the rights. In many cases, collection firms buy these debts in bulk, and don’t bother to verify whether the debt is good before they begin pressing you to pay.
But even if a debt is verified, that does not mean you must endure incessant calls (particularly to your work place), and you definitely don’t have to put up with harassment or abuse.
A “cease communication” letter should put a stop to the calls. You can demand that all contact cease, or that you only wish the agency to further communicate in writing. If you have a consumer lawyer representing you, all contact with the agency should be referred to him or her.
If a collections firm threatens violence, harm to you, damage your property, marring of your reputation or if the language used is obscene or abusive: It’s illegal. So too are repeated calls, hang-up calls, anonymous calls or any other action intended to annoy, harass or abuse.
The FDCPA also prohibits debt collectors from engaging in misrepresentation. This includes:
- Claiming to be a lawyer;
- Falsely representing the character, amount and status of debt;
- Implying they are employed by a credit reporting agency;
- Threatening legal action when none is intended;
- Communicating false information about a consumer’s credit.
Debt collectors who do not comply with all provisions of the FDCPA may face fines and penalties.
Generally, violation of FDCPA is based on strict liability, which means plaintiff does not have to prove the action was knowing or intentional. However, courts will consider the frequency and persistence of non-compliance and intentional violations could result in more severe penalties.
Debtors and third parties can bring action, and the statute of limitations is one year.
Per 15 USC 1692k(a)(1), debt collectors found to have violated fair debt collection practices must pay the sum equal to actual damages sustained by plaintiff. Usually, this takes the form of emotional distress. The court may also impose additional statutory damages of up to $1,000, plus plaintiff attorney fees and court costs.
Contact the Miami Consumer Protection Lawyers at Jacobs Keeley Trial Lawyers for a confidential appointment to discuss your rights.
Call us at (305) 358-7991.