The Fair Debt Collection Practices Act (FDCPA), codified in 15 USC, section 1692, is a federal statute which was enacted to protect consumers from abusive, unfair or deceptive practices by debt collectors.

Who is considered a debt collector?

Under Section 1592a(6) of the FDCPA, a debt collector is defined as “any person who uses any instrumentality of interstate commerce or the mails in any business, the principal purpose of which is the collection of any debt, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.” (emphasis added). This includes attorneys and Mortgage Servicers, but not creditors (or their employees) seeking to recover their own debts. Note, however, that it does apply to “any creditor, who in the process of collecting his own debt, uses any name other than his own, which would indicate that a third person is collecting or attempting to collect the debt.

What does the Act mandate? The statute sets forth how a debt collector is and is not permitted to communicate with a consumer while attempting to collect a debt.Some of the provisions include:

  • A debt collector can only contact the consumer after 8 a.m. and before 9 p.m., unless they agree otherwise.
  • If it is known that the consumer is represented by counsel, the communications must be conducted through the consumer’s attorney.
  • If the debt collector knows or has reason to believe that the consumer’s employer doesn’t permit them to be contacted during work hours, contact should not be attempted during these times at the consumer’s place of business.
  • If a consumer communicates to the debt collector in writing that he or she refuses to pay the debt or wants the debt collector to stop contacting them, no more contact can be made, except that the debt collector is permitted to tell the consumer that they may be taking some specific action, such as filing a lawsuit.
  • Debt collectors must send a written notice within five (5) days of their first communication with the consumer providing the amount that’s owed and who the creditor is. The notice must also advise them that they have the right to dispute the validity of the debt, and that if they do, no further collection action will occur until the validation has been provided.
  • Debt collectors can’t make misleading representations or statements. They cannot threaten to garnish wages or attach or sell property unless they are permitted by law to take these actions, and actually intend to do so.
  • Debt collectors can’t give false credit information to anyone, such as credit reporting companies. They cannot use a false company name, or send a document purporting to be an official court or governmental agency document if it is not one. They can’t engage in unfair practices by trying to collect an unauthorized charge over and above what is owed, unless allowed by state law or by contract.

If a debt collector fails to comply with the Act, a consumer may sue for actual damages as well as statutory damages. If successful, the consumer may also be awarded attorney’s fees, which can be very substantial.