Category Archives: Recent Articles

Debt Collection Harassment on Facebook

Posted on by
5


Many debt collection cases now spring from Social Media sites and the most popular of these is Facebook. These social media sites are an excuse to obtain information about consumers who debt collectors are probably not able to reach.

Since there is no way to find out if the person who sent you a friend request is sending with a genuine interest you accept the friend request in all innocence. Debt collectors lie in order to become your friends. Last year there were two cases where consumers complained of debt collectors harassing them by communicating through their Facebook accounts.

In a recent case in Mid West, a consumer received a request to be friends with a woman's photograph in the profile. Debtor accepted this request in all earnestness and faced terrible outcome when the collectors posted a message on his wall – “ Pay your debts.”

The Fair Debt Collection Practices Act (FDCPA) came into existence in 1978 to address the many complaints the Federal Trade Commission (FTC) was receiving about debt collection harassment. The FDCPA laws did not have a provision for Facebook as at that time nobody even knew about social media sites. However, in the Facebook or other social media site cases a new appellate law has to find place.

In a recent social media case, an Orlando court ruled that a debt collector used Facebook to unlawfully harass a debtor. The Orlando court did not change its decision though the debt collector argued that social media sites are not covered under the FDCPA. This is a very important issue and needs to be addressed on a countrywide basis.

Some debt collection agencies have also violated the FDCPA by disclosing the debt to all of the debtors' friends in his Facebook list of friends openly by posting on the debtors' walls. In Florida, a debt collector used Facebook to tell debtor's family and friends to have her call him for a debt she owed.

The misuse of social media sites is a new method in debt collection harassment. By using false identity, disclosing information to debtors' friends and family and publicly shaming a consumer, debt collectors face charges under the FDCPA. Though the FDCPA does not have a provision for Facebook, violations of the Act are very clear when debt collectors reach debtors through a social media site plainly to harass him.

Some Collection agencies which use Facebook and other social networking sites in order to reach borrowers have identified themselves. Once debt collectors become your friends they invade your inner circles and find out about your wealth. If you declare you do not have funds but have photos displayed on your Facebook with a show of wealth, they would make an issue out of this this and ask you to pay up.

Debt collection agencies that violate the FDCP Act

Posted on by
9

The collection agencies’ active participation in collecting debts from the vulnerable debtors in the US has increased in the recent years. These agencies employ illegal means to collect debt from the borrowers. With the rising complaint of the victims the federal law has been forced to implement Fair Debt Collection Practice Act to prevent creditor harassment. According to the FDCPA, the debt collectors are forbidden from illegal collection practices, using abusive language, threatening calls to the debtors and so on.

Here are some instances how these collection agencies have violated the FDCP Act.

The owner of the Legal Action Recovery, a professional debt collection firm, violated the FDCPA rule. The firm threatened the debtors to pay off debt. However, at that time these victims didn’t even owe the debt as it had been discharged in bankruptcy procedure and passed the statute of limitations. The debt collectors even warned the debtors of taking legal action if the payments are not made within time. The firm even masqueraded as law enforcement officers to pressurize the victims to clear their payment of the delinquent account.

The owner tried to operate his firms from prison and corresponded with his staffs regarding the account management and personnel issues. He was always updated about his banking activities. So, the New York Attorney General’s Office has lodged charges against the owner continuing to operate the firm.

Charges have been filed against Buffalo, NY collection agency operated by Tobias Boyland, known as Bags of Money, for creditor harassment. Boyland’s debt collectors violated the state as well as federal law disguising as law enforcement officials. Most consumers gave in to the demands of the collection agency as they were threatened of being arrested on failing to make their payments. The collection agency has been found claiming for non-existent debts. This agency even tried to collect payments after the passing of the statute of limitations or overstated the amount owed on the actual debt. The intimidated debtors usually make payments to avoid further harassment and humiliation. The company used to provide wrong contact information to make the consumers believe that the businesses were located far from the Buffalo area.

California’s Bad Check Diversion Act (BCDA) empowers a district lawyer to sign a contract with a private body to run a diversion program for poor check writers. The company District Attorney Technical Services Inc had an agreement with various district attorneys' offices to offer collection services to merchants who were offered with bad checks. The CEO of District Attorney Technical Services Inc. (DATS) was found personally liable for violating FDCPA. He was involved in collection practices and the firm’s only source of income was its collection activities based on the contract that he negotiated with the district attorneys' offices. This firm even collected fee that was not authorized by the Bad Check Diversion Act (BCDA). The court was informed that the collection letter stated that legal action and arrest warrants will be issued for individuals who are unable to pay on time. But DATS never bothered to present the file before the district attorney's office. Therefore, the firm violated the FDCP Act and had to face the consequences.

Continental Central Credit (CCC) collected delinquent accounts for The Association for Maintenance Fees. CCC charges 40% on all debtors account after the money is retrieved from them. The collection agency sent second collection notice less than 30 days after sending the first notice thus violating the FDCPA rule implemented by the Federal Trade Commission. The debtor bought a class against the CCC for violating the Act. The debtor had 30 days to dispute the validity of the debt from the initial correspondence from the debt collectors. So, this is also considered to be a threatening tactic as the susceptible debtors might think that if they are unable to make the payment it might lead to some legal action.

So these are the four amongst many other debt collection agencies that have violated the FDCP Act and had to pay for the consequences for illegitimate debt collection practices.

Debt Collection Laws Prohibit Trespassing Your Property

Posted on by
15

All debt collection agencies and debt collectors employed by these agencies that collect on debts are governed and regulated by the Fair Debt Collection Practices Act (FDCPA). The FDCPA is a federal statute enforced by the Federal Trade Commission (FTC) to ensure fair debt collection.

Debt collectors are the third party debt collection agents who have bought delinquent debts form creditors at a throw away price and attempt at collecting debt amount or more than debt amount. These debt collectors do not adhere to the FDCPA while attempting to collect money from you. Often they simply ignore the FDCPA guidelines and insist on illegal and unethical practices.

One such aggressive approach by debt collectors is trespassing your private property and entering your premises to collect a debt. Though a debt collector can visit your home or office to attempt debt collection, there should be a prior consent from the consumer for such thing.

Communication in connection with debt collection per 15 USC 1692c of the FDCPA has a clear explanation about this aspect. It states “Without the prior consent of the consumer given directly to the debt collector or the express permission of a court of competent jurisdiction, a debt collector may not communicate with a consumer in connection with the collection of any debt at any unusual time or place or a time or place known or which should be known to be inconvenient to the consumer. In the absence of knowledge of circumstances to the contrary, a debt collector shall assume that the convenient time for communicating with a consumer is after 8 o’clock anti-meridian and before 9 o’clock post-meridian, local time at the consumer’s location;”

The FDCPA also states that if you are represented by an attorney and you have informed debt collectors, debt collectors should not communicate with you anymore. If the debt collectors know that your employer disapproves of their visit to the work place, they should stop all such visits or phone calls on office numbers.

With the debt collection laws in place, you have a shield to protect you from debt collection harassment. If a debt collector visits you at home or office against your wishes you can quote from the debt collection laws. Such knowledge should arrest these mean collectors in their tracks.

Contact an FDCPA attorney well versed with the debt collection laws if you are being harassed by debt collectors. An FDCPA attorney can represent you and help you with legal action. You may contact Krohn & Moss Ltd. CONSUMER LAW CENTER

Al Franken’s End Debt Collector Abuse Act

Posted on by
4

The Al Franken Act demands a prohibition on collectors from seeking a warrant for the arrest of a debtor. A very big number of debtors face arrest charges and imprisonment because debt collectors unlawfully get them arrested.

In 1977, Congress passed the Fair Debt Collection Practices Act (FDCPA) to ensure fair debt collection methods. But times have changed and that law needs updating. When the laws were formed, the Congress did not foresee the rise in abusive practices in the debt collection industry. Debt collection industry has devised ways around the law to make their profits riding piggyback on hardworking Americans' backs.


All around our country, there are numerous stories of people being taken advantage of by unscrupulous debt collectors. The debt collectors don't let the law or common decency stop them from doing whatever it takes to make money. These abuses include nasty and harassing comments including the use of racial slurs and going after innocent people for debts that they don't owe.

Debt collectors have all the time and now some are even exploiting scarce law enforcement resources. Debt collection firms are preying on innocent people who do not know their rights to fight back. This is an unfair fight and usually debtor is taken for a ride. For some people, this bad situation spirals into an even worse nightmare when they end up in jails.

One woman who told her story, a Minneapolis resident, spent a full day in jail over a $250 credit card debt. During that day, she was treated like a criminal, groped by one inmate and offered drugs by another, and shared a room and a toilet with a dozen other women, with no privacy. It seems that collectors have found a way to get around the law for making a profit.

In Minneapolis, Senator Al Franken took it upon himself to bring the End Debt Collector Abuse Act into existence that would require the following:

  • Forbid debt collectors from seeking arrest of a consumer for a payment
  • Debt collectors should provide itemization of the principal, fees and interest
  • Debt collectors require to provide the name of the original creditor up front
  • A thorough investigation of consumers' dispute should be in place by debt collectors
  • Debt collectors must provide specific evidence to the dispute
  • An increase in penalties for violating consumers' rights

Al Franken recognized that there were big problems in the debt collection industry that were long overdue in being addressed.

The Rosenthal Fair Debt Collection Practices Act is similar to the FDCPA

Posted on by
16

The Fair Debt Collection Practices Act (FDCPA) is a federal statute constituted by the Federal Trade Commission (FTC) to protect and ensure fair debt collection practices. This Act provides consumers an avenue for disputing and obtaining validation of debt information in order to ensure the information accuracy. The Act creates guidelines under which debt collectors may conduct business, defines rights of consumers involved with debt collectors, and prescribes penalties and remedies for violations of the Act. This Act is sometimes used in conjunction with the Fair Credit reporting Act (FCRA).

While the FDCPA is a federal statute, the states have different laws along the lines of the FDCPA. There are not many differences in the federal and state Acts but each state has certain specific rules attached to their statutes. California has its laws which are commonly referred to as Rosenthal Fair debt Collection Practices Act (RFDCPA).

Per the FDCPA, a debt collector is a third party collector either employed by a creditor or by a debt collection agency which is collecting on the debt. The RFDCPA differs in this as the RFDCPA includes creditors as debt collectors. In the RFDCPA, collection of property is included. In addition to the federal notices that are required by the FDCPA, the RFDCPA requires more notices. The RFDCPA includes in its violations all of the acts that are violations of the FDCPA with a couple of minor exceptions.

“California Civil Code 1788.2 (c) says the term “debt collector” means any person who, in the ordinary course of business, regularly, on behalf of himself or herself or others, engages in debt collection. The term includes any person who composes and sells, or offers to compose and sell, forms, letters, and other collection media used or intended to be used for debt collection, but does not include an attorney or counselor at law.”

So, if you start getting collection letters from anyone, including the creditor, and you live in California, you should check with an attorney to see if there are any FDCPA or RFDCPA violations.

Krohn & Moss, Ltd. has qualified RFDCPA attorneys who have helped thousands of customers in dealing with debt collection harassment cases.

Does the FDCPA provide for contacting deceased debtor’s relatives?

Posted on by
27

The Fair Debt Collection Practices Act (FDCPA) is a federal statute established to protect debtors from debt collection harassment. This Act is enforced by the FTC and private attorneys. The act protects debtors form third party debt collectors who may harass them in the event of your near one's death.

The FDCPA does not provide for the dead person's near ones to be dragged into the payment of a debt unless they co-signed or otherwise guaranteed a loan, credit card. If not they are generally not responsible for a deceased family member's debt. According to the FTC, a surviving relative usually has no legal obligation to pay the debts of a dead family member. In fact, the rights of surviving relatives are covered by the FDCPA, which prohibits debt collectors from using abusive, unfair, or deceptive practices to collect from them.

As a relative of the deceased debtor you are not obligated to repay debts owed by your relative. Unless a relative like spouse or children co signed, the debt is the deceased's and is not required to be collected from the surviving members. If you are contacted by a debt collector, tell them that the person they are trying to reach is dead. If you know the contact information of the deceased’s personal representative (the individual in charge of administering or executing the estate) then you may provide this to the debt collectors. If a debt collector persists in contacting you, send them a certified, return-receipt cease and desist letter advising the collector to stop all contact.

It is usual to pay off any debts through proceeds of the deceased's estate through a probate process. The probate process involves not only settling any debt, but also transferring any assets to beneficiaries named in the will as well. However, before any beneficiary can collect from the estate, all debt must be paid first. Probate courts handle the probate process, which includes notifying creditors that the borrower has died and taking inventory of his property.

Children who have lost both the parents do not have to pay for the deceased's debt. But if children or spouse or any other relative have co signed with the debtor, they will be held responsible for repaying of the debt. If debt collectors harass the deceased's family of other relatives for the payment, it would be best to contact an FDCPA attorney and stop harassment.

Under certain circumstances, the spouse of the deceased might inherit the debt (for example in community states like Nevada, Alaska etc), but this is not always the case. Credit card companies and other debt collecting agencies have the right to collect outstanding debt from the estate of the deceased. Federal laws protect all surviving family members from harassing debt collectors.

Is recession a reason to stop paying your bills?

Posted on by
78

Like it or not, if you have a credit card and have spent on it, you are a debtor. You have to repay what you have spent and not paying attracts debt collectors calling you. The recession in the recent years or the sky rocketing cost of living are not reasons for not repaying debts. Typically, debt problems have not fallen from the far and wide sky but are a making of your own bad spending habits, unemployment and credit card theft.

Whatever your reasons for ending up in credit card debt are, you are entitled to a fair collection of debt under the Fair Debt Collection Practices Act (FDCPA) enforced by the Federal Trade Commission (FTC). You may consider the following options to eliminate debt.

The first option to consider when you are unable to pay debts is to talk to your creditors directly. A direct conversation is always appreciated. Seek debt reduction rates and negotiate to as low a rate as possible that would lead to lowered outstanding balance to be paid over a period of time. During such negotiations you may get a chance to set your own debt reduction rates.

Debt consolidation is another option when there are too many cards in question. In debt consolidation, all the cards are taken together, totaled and then a payment plan is deduced to mutual satisfaction of debtor and creditor. In the process, you will manage one single payment every month and the hassle of paying too many bills is no longer there. Debt settlement also is available which requires you to consult a debt settlement company that will negotiate with your creditor and reduce the total outstanding balance. You will be required to finish paying off the debt by the date set by the creditor.

Check if your debt has crossed the Statute of Limitations (SOL) which would mean you do not have to pay a penny. Any debt that has surpassed the “due date” need not be paid. In this case, the creditors have no rights to demand payments from the debtors and the same thing applies when those debt collectors demand payments from the debtors.

It is advisable not to pledge your retirement benefits though many Americans consider this option to come out of debts. Pledging your retirement money would reduce your account by a major share. Withdrawing retirement benefits prematurely also attracts penalty which would double your risk.

One good idea is to transfer your outstanding balances to zero interest rate credit cards. Such cards usually come during promotional offers and if you can grab such cards, you can pay interest free installments.

Whatever the method you choose to free yourself from the shackles of debts, do not get into any new debts. A lowered outstanding balance should not tempt you to get into more debts or a completely written off debt should not induce you to spend again on credit cards. The secret of financial peace comes from budgeting and spending wisely.

Debt collector harassment can impact your personal and professional life

Posted on by
30

The Fair Debt Collection Practices Act (FDCPA) is a federal act that came into existence to ensure fair debt collection. The act is enforced by the Federal Trade Commission (FTC) and private attorneys to protect consumers from unfair practices of the third party debt collectors.

The third party collectors often engage in techniques that can be termed as acts of harassment. Debt collector harassment makes a difference to your personal and professional life adversely. A debt collector calling your employer for payment on your debt is a violation of the FDCPA. Repeated calls on your home phone amount to disturbance and can even create psychological distress and affect your personal life.

The Fair Debt Collection Practices Act (FDCPA) has a set of rules that determine what can be termed as debt collector harassment. Debt collector harassment can be either written or verbal. Debt collector harassment in any form is considered a violation by the FDCPA and is punishable in a court of law.
According to the FDCPA even if you owe an amount you are entitled to be protected against debt collectors. You should be given a decent and fair treatment during the debt collection process.

The following are considered as methods of debt collector harassment:

  • Calling repeatedly over the phone
  • Threatening to use violence
  • Using obscene or abusive language
  • Calling at work place
  • Calling after you request him not to call
  • Not disclosing name over the phone
  • Demanding more payment than due
  • Sending notices that look like court notices
  • Attempting to extract payment over phone
  • Giving false identity of being an attorney

You have a right to stand protected and not suffer debt collector harassment. Before your professional and personal life take a downward turn you should take steps to stop these calls. The first step you should take if you are being harassed by debt collectors is to gather all possible information about the debt, collector's name, address and phone numbers.

You should next get the caller's mailing address. If you have received a letter from the callers for the debt payment you will already have the address. If you have not then ask for the mailing address. You may not disclose the reason for asking the address.

You should send a cease and desist letter by a certified mail with a return receipt request to this mailing address. This letter is a powerful tool to put the harassment at bay. A cease and desist (C&D)letter is to inform debt collectors officially to stop all communication with you. You may engage an FDCPA attorney to draft a C&D letter. An FDCPA attorney would know exactly what details to include in the letter.

Once you send C&D letter debt collectors should stop all collection activity. Should they continue any more attempts to collect payment on debts you can file a complaint with the FTC and pursue the case legally.

Debt Collectors should send consumer notice

Posted on by
63

The Fair Debt Collection Practices Act (FDCPA) enforced by the Federal Trade Commission (FTC) and private attorneys, allows to check the abusive conduct by debt collectors. This was also in the wake of the number of bankruptcies increasing due to these practices. The FDCPA provides guidelines for debt collectors collecting legitimate debts and provides protections and remedies for debtors.

The FDCPA covers all personal debts, family, household and medical debts, and credit card bills. The FDCPA is a federal law and different states in the United States have different debt collection laws. While filing a case you must take into consideration both the state and federal laws. The state laws are similar to the federal laws in structure but may cover a broader range of debts.

In house debt collectors or debt collectors engaged by creditors are normally not governed by the FDCPA. The Act governs third party collectors.

A debt collector should inform you the following in writing:

  • The amount of money you owe
  • The name of the original creditor to whom you owe
  • Debt collectors should mention that unless you dispute the validity of the debt or a part of the debt, the debt will be assumed valid by the debt collector
  • If you dispute the validity of the debt in full or in part within the thirty day period, the debt collector will send you the debt verification
  • The debt collector will provide the name of the original creditor in reply to your written request within thirty day period
  • If the creditor mentioned by the debt collector is different from the original creditor, the debt collector should provide you the details of the original creditor
  • Debt collector needs to send a warning stating that the communication is from a debt collector and that the information he collects may be used to collect debt
  • The first notice from debt collectors as well as all subsequent communication should contain this warning

Debt collectors are not bound by the initial thirty day period to continue the debt collection process. The only measure that debt collectors must take care of is to abide by the rights you have in the FDCPA. Their debt collection methods should be within the guidelines under the FDCPA.

Failing to send information is tantamount to violating the FDCPA. In 2009, 22,708 complaints of the total FDCPA complaints or 25.7% were about debt collectors not providing the required notices. This was 10% more than the complaints in 2008 which was 15.7%.

Verifying debts at your written request is mandatory under the FDCPA. If debt collectors do not verify the disputed debts, they must cease all collection efforts. In 2009, 11.5% of all FDCPA complaints were about not verifying disputed debts.

It is imperative for debt collectors to send consumer notices. The absence of such notices is considered a violation of the FDCPA. Your rights under the FDCPA protect you against such violations. You may contact an FDCPA attorney if you are a victim of such a violation.

Zombie Debt – Bringing dead debt to life

Posted on by
42

One of the violations of the Fair Debt Collection Practices Act (FDCPA) enforced by the Federal Trade Commission (FTC), is collecting a non existent debt. Debt Collectors resort to creating phantom debts or bringing old and paid debts to life in search of easy money.

Creditors, unable to recollect debt from debtors, usually sell debts to third party debt collectors. These third party debt collectors are over zealous to extract money from innocent consumers. The debt collectors buy debts from creditors for a throw away price and have nothing to lose. However, each debt collector's commission is calculated on the basis of his ability to collect payments on debts.

Debt collectors need prey to feed on. You are the vulnerable victim that they have found for this purpose. Debt collectors bet on your lack of knowledge of your rights in the FDCPA. They often dig out old debts either completely paid or written off or have crossed the Statute of Limitations. These are called zombie debts. They are used by debt collectors to intimidate you to pay up. You have rights in the FDCPA that protect you from such debts.

If you are being harassed by a debt collector for an old debt of yours which you have repaid completely, you have to use your first tool – ask for validation of the debt within 35 days of the first call from debt collectors. Ask the debt collectors to send complete validation of the debt along with the name of the original creditor and details of the amount spent. Your request should be made in writing and the letter sent via certified mail with return receipt request. This should stop the debt collectors in their tracks because it is very difficult for debt collectors to validate a debt that is so old.

Like everything else debts also have expiry dates. The Statute of Limitations (SOL) is the maximum time a debt collector can collect the payment from you. Even after the SOL expires, if debt collectors contact you, you can counter by sending a cease and desist letter to the debt collectors through certified mail with return receipt request. If the debt collector sues you, you may go to the hearing with the SOL and prove your case.

Cease and desist letter is a formal written request to debt collector to stop any further communication with you. This letter should stop the collector from calling you any further. If he continues to call, you can take legal action against him for violation of the FDCPA.

You may engage an attorney to handle the legal aspects of the case and intimate the debt collectors about this. Once you engage an attorney, debt collectors cannot contact you. If he still does he can be sued for this violation of the FDCPA.

Debt collectors cannot legally send your debt payment history to credit bureaus within the 30 days period for debt validation. If he reports, you can dispute the credit report by sending a credit dispute to the credit reporting agencies. It would be better to include a copy of the debt validation letter you sent to debt collectors.