Expert Witness on Illegal Debt Collection PracticesBy HG.org
When someone owes money to a debtor, this account is often referred to a debt collector. Debt collectors must follow federal law and state law when attempting to collect this debt. If the debt collector does not follow applicable laws, it may be liable for violations.
Fair Debt Collection Practices ActThe most thorough law on this matter is the Fair Debt Collection Practices Act, which is a federal law that prohibits certain contact from debt collectors and collection agencies. After years of abuses, the federal law was enacted to curtail illegal acts by debt collectors. This law applies to debt collectors and not the initial creditor. If a debt collector violates this law, the consumer may be able to file a complaint against the debt collector with the Consumer Financial Protection Bureau or the Federal Trade Commission. States may have additional laws that provide additional protections to consumers. Some states have laws that do apply to the initial creditors.
Illegal ActsAn expert witness may be called in to explain the illegal acts that debt collectors made. Some of the acts that debt collectors may illegally commit include:
DisclosuresWhen a debt collector first makes contact with a debtor, it must inform the debtor that it is contacting the individual for the purpose of attempting to collect a debt. It must also state that any information that any information that the debt collector provides will be for the purpose of collecting the debt. The debt collector must also provide the debt collection agency’s name in later communications. Not providing these disclosures can be an unlawful violation.
Communicating about the Debt with OthersThe Fair Debt Collection Practices Act prohibits collection agencies from contacting third parties about the debt. There are certain exceptions to this general rule, though. For example, debt collectors are often permitted to contact the debtor’s parents if he or she is a minor, anyone else who is listed on the debt as a codebtor or the person’s spouse. Additionally, the debt collector can contact a credit reporting agency and the original creditor. The debt collector can talk to the consumer’s lawyer if he or she knows that the debtor is represented by counsel. The debt collector is required to communicate through the lawyer if it knows this, but the debt collector can contact the debtor directly if the debtor gives it permission to do so or if the lawyer does not respond to the communications from the debt collection agency. If a debtor sends a written request asking the debt collector to stop contacting the permitted three parties, it is required to comply.
Additionally, debt collectors can contact others for the limited purpose of attempting to locate the debtor. However, they cannot state that the individual owes a debt.
Continued ContactThere are also certain prohibitions on how and when a debt collector can contact the debtor. For example, it cannot contact the debtor while he or she is at work if the debt collector knows that the employer prohibits calls of this nature at work. The debt collector also cannot contact the debtor before 8 a.m. or after 9 p.m. Additionally, if the debtor explains what times are inconvenient for him or her, the debt collector cannot contact the debtor at these times.
Unfair PracticesCollection agencies are prohibited from engaging in unfair practices. These practices include accepting a postdated check by more than five days and depositing it before this time unless it notifies the debtor of its intent, threatening to seize property that it has no right to, adding interest, fees or other charges that are not prat of the original agreement or causing the debtor to incur additional charges by concealing the reason for the communication.
False or Misleading RepresentationsA debt collection agency cannot lawfully lie about its identity or claim to be something else, such as claiming to be a law enforcement agency or lawyer when it is not. The debt collector cannot represent that the debtor owes more money than the debtor really owes, fail to state that the debtor disputes the debt or threaten to sell a debt to another party in an effort to extinguish possible defenses that it has against the creditor. Debt collectors cannot lawfully claim that a debtor has committed a crime, claim that the debtor will be imprisoned, send a document that appears like it is from a court or part of a legal process when it is not or threaten to take action that cannot lawfully be taken.
While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.