Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act of 1978 ("FDCPA") is federal law designed to promote ethical business practices and protect consumers from unscrupulous and unfair debt collection practices by "debt collectors."  The term debt collector is a term of art that generally limits coverage to debt collection agencies, debt buyers, collection lawyers and mortgage servicers that obtain collection or servicing rights after the loan or other debt is in default.  Several states have adopted laws largely mirroring the FDCPA's broad standards, including Florida where the corresponding state statute is the Florida Consumer Collection Practices Act ("FCCPA").

The FDCPA established in great detail general standards of proscribed conduct that define and restrict abusive collection acts such as harassment, abuse, false or deceptive representations and unfair or unconscionable collection methods.  Under the Act it is unlawful to use false threats of legal action that cannot be taken (for example threatening to sue to collect a debt that is barred by the applicable statute of limitations or was discharged in bankruptcy) and/or to engage in a campaign of late night and repetitive telephone calls.  The FDCPA and the FCCPA both empower consumers to demand an end to all further contact and to require the debt collector to communicate only through the consumer's attorney with respect to the debt - but the consumer must provide the name, address and telephone and other contact information for the attorney. 

The FDCPA gives consumers the right to obtain verification of the debt from the collector.  Verification is designed to minimize instances of mistaken identity of the debtor and mistakes concerning the amount of the debt and/or similar errors.  Thus, within five (5) days of the initial communication with a consumer concerning a debt, the collector must provide the following information unless it was contained in the initial communication:

  • the amount of the debt;
  • the name of the creditor to whom it is owed;
  • a statement informing the consumer that unless the debt, or any part of the debt, is disputed within thirty (30) days, the collector will obtain verification of the debt or a copy of any judgment on the debt and that such information will be mailed to the consumer;
  • a statement that upon the consumer's written request within the thirty-day period, the debt collector will provide the name of the original creditor, if different from the current creditor.

The verification rights notice need not be provided until there is a communication with the consumer.  And the notice of verification right may be sent with the original communication or within the five days.

The debt collector must also disclose in the initial written or oral communication with the consumer that the debt collector is attempting to collect a debt and that any information obtained will be used for debt collection purposes. Furthermore, the disclosure must be made in all subsequent communications.

The following as examples of false and misleading acts or statement that violate the FDCPA:

  • falsely representing to a consumer that the debt was turned over to an innocent purchaser for value - this would preclude a debt collector from representing that it purchased the debt when in fact it was being paid a flat rate or contingent collection fee;
  • falsely representing that a document is legal process - such as sending a letter resembling the formatting, type size and style of a court summons, complaint or other document;
  • using any business name, company or organization other than the true name of the collector's business;
  • misrepresenting that a legal process form does not require a response from the consumer; 
  • falsely representing that a debt collector is a credit reporting agency.   

Remedies for Violations of the FDCPA

A debt collector who violates the FDCPA and FCCPA while attempting to collect a consumer debt is subject to suit by any person adversely affected by the violation.  The FDCPA grants concurrent federal and state jurisdiction and the successful plaintiff can recover: