The Fair Debt Collection Practices Act or “FDCPA” was established as legal protection for consumers against abusive debt collection practices. The statutes’ purpose is to eliminate abusive practices in the collection of consumer debts, promote fair debt collection, and provide consumers with an avenue for disputing and obtaining validation of debt information in order to ensure the information’s accuracy. The federal statute was also created to promote consistent state action to protect consumers against abusive debt collection.
FDCPA Terms
Consumer: “Any person obligated or allegedly obligated to pay any debt.”
Debt: “Any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for personal, family, or household purposes, whether or not such obligation has been reduced to judgment.”
Debt Collector: “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 debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.”
The FDCPA considers the following not to be debt collectors:
1. Any person acting as a debt collector for another person both of whom are related by common ownership or affiliated by corporate control.
2. Any officer or employee of the United States if that officer or employee is acting within the performance of their official duties.
3. Any person serving or attempting to serve legal process in conjunction with the judicial enforcement of a debt.
4. Any non-profit organization which performs consumer credit counseling and assists consumers in the liquidation of their debts.
5. Any person collecting or attempting to collect any debt owed or due or asserted to be owed or due another to the extents such activity is incidental to a bona fide fiduciary obligation, concerns a debt which was originated by such person, concerns debt which was not in default at the time it was obtained by such person, or concerns a debt obtained by such person as a secured party in a commercial credit transaction involving the creditor.
FDCPA Civil Liability
The FDCPA prohibits “any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt”. 15 U.S.C. § 1692d. Some examples of conduct prohibited under the FDCPA include the use or threat of violence, the publication of lists of “deadbeats,” repeated or continuance phone calls, telephone calls without any disclosure of the callers’ identity, or advertisement for sale of any debt to coerce payment of the debt.
Under the FDCPA a debt collector can be held liable if it makes false, deceptive, or misleading statements to coerce payment of a debt. The standard to determine whether any statements are deceptive or misleading is measured by the least sophisticated consumer and how they would interpret a communication. Duffy v. Landberg, 215 F.3d 871, 874 (8th Cir. 2000).
“Unfair practices” include collection of money for which there is no express authorization by agreement or under law, making collect telephone calls, threatening disposition of property without a present right of possession, communications versus postcards, and the use of certain language or symbols on envelopes. 15 U.S.C. § 1692f.
If any debt collector is found to have violated the FDCPA in any way described above, that debt collector is liable to the consumer.
FDCPA Damages
Under the FDCPA a consumer can collect actual damages and statutory damages that do not exceed $1,000.00. 15 U.S.C. § 1692k(a). There is no equitable relief under the FDCPA, which means there is no injunctive relief, declaratory relief or any equitable relief of any kind. Lastly, a plaintiff that is successful in a FDCPA action may be awarded costs and reasonable attorneys’ fees.